Employer-Based Health Coverage Weakening in Pennsylvania

September 10, 2009

A larger share of Pennsylvanians lacked health insurance in 2007 and 2008 than at the start of the decade, while a smaller share were covered by employer-provided policies, according to Census Bureau data released today.
 
The percentage of Pennsylvanians with coverage provided by an employer was 69.7% in 2007 and 2008, down from 76% in 2000 and 2001.
 
Roughly one in 10 Pennsylvanians lacked health coverage in 2007 and 2008, compared to one in 12 residents lacking coverage in 2000-2001. (The Census figures for Pennsylvania average two years of survey data in order to improve the reliability of the estimates.)
 
These findings, which will very likely worsen in 2009 because of the recession, highlight the need to enact comprehensive health care reform before the end of the year. The longer Congress delays the implementation of reform, the more Pennsylvanians will find themselves without affordable coverage.
 
The decline in health care coverage was driven by the erosion of employer-sponsored health insurance, which itself reflects the rising cost of health care. Both employers and employees are having greater difficulty affording health insurance. Between 2000 and 2009, the cost of family health insurance provided by Pennsylvania employers jumped by 95 percent - more than five times faster than the median income - according to a report released in August by the Washington, D.C.-based Families USA.
 
In total, 1.2 million Pennsylvanians, 9.7% of the population, were uninsured in 2007-2008, according to the Census data.
 
The number of uninsured in Pennsylvania is likely to be much higher in 2009 because of accelerated job loss in the state resulting from the recession. An Urban Institute analysis published earlier this year concluded that for each 1.0 percentage point increase in the unemployment rate, the share of nonelderly adults without health insurance increases by 0.59 percentage point.
 
The state's unemployment rate jumped from 5.5% in July 2008 to 8.5% in July 2009. That three-point rise in the unemployment rate caused an estimated 135,000 working-aged adults to lose health coverage.
 
The Census figures represent the only data available on state health insurance trends over time. Census data scheduled to be released on September 22 will include additional estimates of state and local health insurance information but will not include information on health insurance trends over time.