The headline in the USA Today article:  Employer Provider Insurance Continues to Decline.  Happy Tuesday.   You know I talk a lot about this issue, so much I added a category named Health Insurance. 

The percentage of all employers offering health insurance in the past eight years peaked in 2000 at 69% and has fallen steadily since, hitting 60% this year, according to an annual survey of employers by the Kaiser Family Foundation. Among small firms (three to nine workers), the percentage offering insurance has dropped even more — from 58% in 2001 to 45% this year. 

From 2001 to 2005, the number of uninsured U.S. workers rose by 3.4 million. Almost 19 million workers — 17% of all employees — were uninsured in 2005, according to the Kaiser Commission on Medicaid and the Uninsured.  Remember, this is workers, and doesn’t include their families.

Now, that doesn’t sound too horrible until you know the following:  three quarters of all US business firms have no payroll.  Employers with payrolls account for 23% of all businesses, according to 2004 statistics.  So, let’s talk nearly six million “firms”, or companies that have a payroll, since these firms employ over 115 million people. 

• Nearly eight in ten of firms with a payroll employ less than 1o people.  So, when less than half of these employees receive healthcare insurance from their company, it affects 13,000,000 hard working people.
• Slightly under 20% of firms have between 10 and 99 employees, however these companies employ more than a quarter of all employees. 
• One percent of firms have 100-499 employees but account for more than one in seven jobs.

Here’s the kicker.  Three tenths of one percent (.003%) of all firms have more than 500 employees, however these 17,000 firms employ half of all workers nationally, more than 55 million people.  So, if nearly 40% of these employees are without insurance, add another 22 million to the rolls of the uninsured. 

It gets worse. Lets talk money.  The average workers paid toward the premium for a typical family policy rose from $129 a month in 1999 to $273 this year, a jump of 70% when adjusted for inflation, the Kaiser survey shows.  

A household earning $40,000 this year would have to pay 8% of its pretax income to cover the average share paid by workers — $3,281 — for a typical family policy offered by employers, which this year cost $12,106. That doesn’t include deductibles and co-payments that those with coverage must pay.

And guess what.  I get to jump back into the self-insured game.  COBRA is over, so I get to start paying anywhere from $600 to $1,100 a month depending on how much I feel like gambling on my family’s health for 2008.  Prescription drug coverage adds to the fun, some of the drugs we take have no generic… whee!!  Hello Canada!

Remember, employers have a choice as to whether they want to provide health insurance for their employees.  They may provide it because they feel it is the right thing to do for their workers.  Others may offer it as a recruitment and retention tool.  Others may be in a position where contracts require it.  Honestly, it doesn’t matter. 

Double digit increases to both employers and employees will bust the system.  Fewer and fewer companies will be able to absorb the rising cost or pass it along to customers in an ever increasing competitive environment. 

Government will have to make the classic decision regarding guns vs. butter.

Employers will increasingly make the decision regarding fiscal responsibility to their shareholders vs. the responsibility to their workforce. 

Talk about being stuck between a rock and a hard place.  Be careful getting out though, you may not have insurance to take care of your injuries.  It’s enough to get you sick.