www.ahrq.gov

Agency for Healthcare Research and Quality

MEPS Chartbook No. 10

Medical Expenditure Panel Survey

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Changes in Job-Related Health

Insurance, 1996-99

Premiums

Plan offers Enrollment and employee

contributions
Suggested citation:

Branscome JM, Crimmel BL. Changes in job-related health insurance, 1996-99. Rockville (MD):Agency for Healthcare Research and Quality;

2002. MEPS Chartbook No. 10. AHRQ Pub. No. 02-0030.

The estimates in this report are based on the most recent data available from MEPS at the time the report was written. However, selected

elements of MEPS data may be revised on the basis of additional analyses, which could result in slightly different estimates from those shown

here. Please check the MEPS Web site for the most current file releases—

www.meps.ahrq.gov

AHRQ is the lead Federal agency charged with supporting research designed to improve the quality of health care, reduce its cost, address

patient safety and medical errors, and broaden access to essential services.AHRQ sponsors and conducts research that provides evidence-based

information on health care outcomes; quality; and cost, use, and access.The information helps health care decisionmakers—patients and clinicians,

health system leaders, and policymakers—make more informed decisions and improve the quality of health care services.

MEPS Chartbook No. 10 by:

James M. Branscome, M.S.

Beth Levin Crimmel, M.S.
Medical Expenditure Panel Survey Agency for Healthcare Research and Quality

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i

From 1996 to 1999, the percent of

establishments offering health insurance

rose, but the portion of private-sector

employees actually eligible for such

coverage fell. Even among eligible workers, insurance enrollment dropped.

The portion of private-sector

establishments offering health insurance rose from 52.9% to 58.4% from 1996 to

1999. In 1999, almost 90% of all

employees worked in establishments

that offered such coverage.

About 30% of establishments offered

their employees a choice of health

insurance plans in 1999.This rate was up

dramatically from 21.5% in 1996.

The percent of employees enrolled in exclusive-provider and any-provider

plans declined from 1996 to 1999.Anyprovider plans had the lowest

enrollments for each year.

executive summary

Offers and Enrollment For both single and family plans, more workers were covered by mixedprovider arrangements than either

other type, and the mixed-provider

enrollment rates for both single and

family coverage rose over the 4 years.

More workers were covered by family

plans than single plans each year, but the

portion with single coverage rose over

the period.

Characteristics of

Offers

Premiums and Employee

Contributions

From 1996 to 1999, health insurance

premiums rose 16.7% for single coverage

and 22.3% for family coverage.

In 1999, employees with coverage stood

at 57.6% of all those working in the

private sector, down from 60.1% in 1996.

The portion of establishments offering

any plan not requiring an employee

contribution to the premium fell to

48.5% for single coverage and 29.0% for

family coverage over the 4 years.

In 1999, the average annual single

premium was $2,325 and the average

family premium was $6,058.

Exclusive-provider plans had the

smallest overall premium increases and

the lowest annual premiums of the three

plan provider types.

In general, employers maintained a relatively constant level of cost sharing

with their employees over this 4-year

period.While the dollar amounts paid by

employees rose considerably, the

percent of the total premium that they

paid did not change much.
Health insurance plan—An insurance contract that provides hospital and/or physician

coverage to an employee or retiree for an

agreed-upon fee (premium) for a defined benefit

period.

Offer health insurance—To make available or

contribute to the cost of any health insurance

plan for current employees and/or retirees.

Premium—Agreed-upon fee paid for coverage

of medical benefits for a defined benefit period,

usually a calendar year. Premiums can be paid by

employers, unions, employees, or shared by both

the insured individual and the plan sponsor.

Single coverage—Health insurance that covers the employee only.

Family coverage—Health insurance that covers the employee and the employee’s family. If a

plan offers more than one arrangement for family coverage, premium information for a family of

four is used.

Types of health care provider arrangements:

• Exclusive provider—Enrollees must go to

providers associated with the plan for all nonemergency care in order for the costs to be

covered. Most health maintenance organizations

(HMOs), individual practice associations (IPAs),

and exclusive provider organizations (EPOs) are

exclusive-provider plans.

• Any provider—Enrollees may go to

providers of their choice with no cost incentives

to use a particular subset of providers. Most

conventional-indemnity plans are any-provider

plans.

• Mixed provider—Enrollees may go to any

provider but there is a cost incentive to use a

particular subset of providers. Most preferred

provider organization (PPO) and point-ofservice (POS) plans are mixed-provider plans.

• Managed care—Exclusive providers plus

mixed providers.

Establishment—A particular workplace or

location.

Firm—A business entity consisting of one or

more business establishments under common

ownership or control.A firm represents the

entire organization, including the company headquarters and all divisions, subsidiaries, and

branches.A firm may consist of a single-location

establishment, in which case the establishment

and firm are identical.

Establishment characteristics—Attributes

of an establishment that describe it or its

employees.The following characteristics are discussed in this report.

Industry:

• Agriculture, fishing, and forestry.

• Mining.

• Construction.

• Manufacturing.

• Transportation, communication, and utilities.

• Wholesale trade.

• Retail trade.

• Finance, insurance, and real estate.

• Services.

Ownership:

• For profit, incorporated.

• For profit, not incorporated.

• Nonprofit.

Age of firm:

• Less than 5 years.

• 5-9 years.

• 10-19 years.

• 20 or more years.

Multi/single status:

• Two or more locations.

• One location only.

Percent full-time employees:

• Less than 25%.

• 25-49%.

• 50-74%.

• 75% or more.

Union presence:

• No union employees.

• Has union employees.

Percent low-wage employees:

• 50% or more low wage.

• Less than 50% low wage.

Firm size:

• Less than 50 employees.

• 50 or more employees.

Employee—A person on the actual payroll.

Excludes temporary and contract workers but

includes the owner or manager if that person

works at the firm.

Full-time employee—A term defined by the

respondent. Generally, a full-time employee

works 35 to 40 hours per week.

Part-time employee—An employee not

defined as full time by the respondent.

Low-wage employee—An employee who

makes $6.50 per hour or less.

Union presence—An establishment has a

union presence if any of its employees are covered by a collective bargaining agreement.

Medical Expenditure Panel Survey Agency for Healthcare Research and Quality

iii

Definitions of Terms
1 Introduction

3 Data in This Report

5 Section 1

Offers and Enrollment

11 Section 2

Characteristics of Offers

19 Section 3

Premiums and Employee Contributions

29 Looking Ahead

Medical Expenditure Panel Survey Agency for Healthcare Research and Quality

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contents

v
Job-related health insurance

(insurance obtained through the

workplace) is a key underpinning of

the Nation’s health care system.

Because there is a lack of consistent,

ongoing information about

employer-sponsored insurance,

there is limited understanding of

this important topic.

The annual Medical

Expenditure Panel Survey Insurance

Component (MEPS IC), begun in

1996, fills much of this information

void. It allows analysts to look at

statistics for single years and to

investigate trends in the data from

year to year and for longer periods.

At the time this report was

prepared, MEPS IC estimates were

available for 1996 through 1999.

Many factors influence whether

workers and their families obtain

health coverage through their jobs.

They include whether coverage is

offered to any employees in the

workplace, whether the specific

worker is eligible for coverage, the

types of plans offered, premium

costs, and required employee

contributions. These factors can

vary depending on establishment

characteristics such as size, industry,

and type of employee (low wage,

unionized, etc.).

This report looks at changes in

job-related health insurance

coverage in the private sector over

the period 1996-99. Section 1

discusses the extent to which

employers offered coverage over the

4 years, as well as enrollment rates

of workers. The next section looks

at the types of plans offered and the

extent to which coverage was

available without the employee

having to contribute to the

premium cost. Finally, the cost of

coverage—both overall and any

employee share—is analyzed in the

last section. Single and family plans

are discussed separately.

Medical Expenditure Panel Survey Agency for Healthcare Research and Quality

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introduction

1
The data in this report come

from the private-sector sample of

the Medical Expenditure Panel

Survey Insurance Component

(MEPS IC), conducted for the

Agency for Healthcare Research and

Quality by the U.S. Census Bureau.

The MEPS IC is an annual survey

of private-sector establishments and

State and local governmental units

that was first conducted for 1996. It

provides estimates of job-related

insurance both at the national level

and at the State level for 40 States

in any given year. The data shown

in this chartbook refer exclusively to responding private-sector

establishments and their employees

and are drawn from more detailed

tables that appear on the MEPS Web site at:

www.meps.ahrq.gov/data_pub/ic_

toc.htm

The private-sector sample size

for the MEPS IC survey was

approximately 39,000 sample units

for each of the 4 years covered in

this report. However, the final

sample size for each year varied

based on the survey nonresponse

rate, which ranged from 68% to

75% over the 4-year period; the

number of out-of-scope units; and

the number of additional sample

units purchased by State agencies, if

any, to augment the total sample

size for their State. For more

information on the MEPS IC

sample design and weighting

structure, see MEPS Methodology

Report No. 6 (Sommers JP. List

sample design of the 1996 Medical

Expenditure Panel Survey Insurance

Component. Rockville (MD):

Agency for Health Care Policy and

Research; 1999. AHCPR Pub. No.

99-0037).

In this report, “establishment”

refers to a particular workplace or

location. “Firm” refers to a business

entity consisting of one or more

establishments under common

ownership or control. “Single

coverage” refers to insurance that

covers only the employee. “Family

coverage” is for the employee and

the employee’s family. If a plan

offers more than one arrangement

for family coverage, the survey asks

for premium information for a

family of four. Please refer to the

Medical Expenditure Panel Survey Agency for Healthcare Research and Quality

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data in this report

3
Agency for Healthcare Research and Quality

4

Medical Expenditure Panel Survey

Definitions of Terms shown on

page iii for additional definitions.

When looking at the premium

data shown here, do not assume

that all health insurance plans have a

standardized package of benefits.

Because plans offer various benefits,

higher premiums may indicate that

a plan offers more generous

benefits. The variations in premiums

also may reflect differences in

medical costs, enrollment patterns,

State regulations, and plan types. 

Unless otherwise noted, only

differences that are statistically

significant at the 0.05 level are

discussed in the text. In some cases,

totals may not add precisely to

100% because of rounding.

Besides the Insurance

Component, MEPS includes

components on households and

medical providers. Based on all of its

components, MEPS provides

detailed nationally representative

data on health status, health care

use and expenses, and health

insurance coverage of individuals

and families in the U.S. civilian

noninstitutionalized population.

More information on the other

MEPS components can be found on

the Web at:

www.meps.ahrq.gov
Offers and

Enrollment

One of the most important

statistics concerning employerprovided health insurance is how

many workers actually have

coverage. However, understanding

and analyzing such job-based

coverage requires knowing the

degree to which employers offer

such coverage and how many

workers are actually eligible to

enroll. A person who works in an

establishment that does not offer

health insurance obviously cannot

have such insurance, but neither can

an individual worker who fails to

meet some eligibility requirement,

such as length of service with the

employer or hours worked per year.

Medical Expenditure Panel Survey Agency for Healthcare Research and Quality

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section 1

5
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Agency for Healthcare Research and Quality

6

Medical Expenditure Panel Survey

How did the percent of establishments offering

health insurance change from 1996 to 1999?

The percent of private-sector

establishments offering health

insurance rose from 1996 to 1999.

In 1996, 52.9% of establishments

offered health insurance. By 1999,

the proportion was up to 58.4%.

Generally, the same trend toward

increasing offer rates appeared

regardless of size, industry, type of

employee, or other establishment

characteristic.

• For example, 41.7% of

establishments in firms with less

than 50 employees offered health

insurance in 1996. That number

climbed to 47.1% in 1999.

• For establishments in firms with

50 or more workers, the figures

were 93.9% in 1996 and 96.9% in

1999. In general, the larger a

firm’s size, the more likely an

establishment within the firm is

to offer health insurance.

• One exception to the overall

pattern occurred in older firms

(20 or more years old). The

percent of establishments in such

firms offering health insurance

declined from 69.9% in 1996 to

67.3% in 1999. However, despite

the dip from 1996 to 1999,

establishments in older firms still

had a larger percent of

establishments offering insurance

than establishments in newer

firms.

52.9

0

10

20

30

40

50

60

70

80

90

100

0

10

20

30

40

50

60

70

80

90

100

0

10

20

30

40

50

60

70

80

90

100

All establishments

Percent of private-sector establishments that offer 

health insurance

58.4

1996

1997

1998

1999

Less than 50 employees 50 or more employees

52.4 55.2

41.7 40.4 43.7 47.1

93.9 95.6 96.3 96.9

Firm size

Percent

10-19 years

28.2

0

10

20

30

40

50

60

70

80

0

10

20

30

40

50

60

70

80

0

10

20

30

40

50

60

70

80

Less than 5 years

Percent of private-sector establishments that offer 

health insurance

37.2

1996

1997

1998

1999

5-9 years 20 or more years

27.2

35.5

38.2 39.341.1

45.4

51.352.4

50.0

52.9

Age of firm

Percent

69.9

72.8

65.967.3
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Agency for Healthcare Research and Quality

7

Medical Expenditure Panel Survey

Was there a trend in the percent of employees

working in establishments that offered health

insurance?

The percent of employees who

worked in establishments that

offered health insurance increased

from 1996 (86.5%) to 1999

(89.1%). There were some

exceptions to this trend for specific

establishment characteristics.

• Only three industry groups

showed a statistically significant

increase–manufacturing, retail

trade, and services.

• Even with the increase, retail

trade and services still were

below the national average for

1999. Construction and

agriculture, fishing, and forestry

also fell below the national

average.

60.1

30 40 50 60 70 80 90 100 30 40 50 60 70 80 90 100

Percent of employees working in establishments 

that offer health insurance

77.3

1996

1999 59.6

73.7

81.3

85.1

85.1

87.9

86.5

89.1

91.1

95.2

Industry group:

Agriculture, fishing, and forestry

Construction

Retail trade

Services

Total

Transportation, communication, 

and utilities

Finance, insurance, and real estate

Wholesale trade

Manufacturing

Mining

91.6

93.2

92.4

94.7

94.5

95.9

94.8

97.3

Percent
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Although the percent of

employees working in establishments

offering health insurance rose, the

portion of workers who actually were

eligible for coverage fell. In 1996,

81.3% of employees were eligible for

insurance. This fell to 78.5% in

1999.

• In establishments where 50% of

more of the employees were low

wage, the proportion of eligible

employees dropped to 48.1% in

1999, down from 60.3% in

1996.

• The percent of employees eligible

for health insurance also declined

in establishments with less than

50% low-wage workers.

However, in 1999, the figure still

stood at 81.4%.

Agency for Healthcare Research and Quality

8

Medical Expenditure Panel Survey

Did the number of workers eligible for

health insurance also increase?

81.3

0

10

20

30

40

50

60

70

80

90

0

10

20

30

40

50

60

70

80

90

0

10

20

30

40

50

60

70

80

90

All establishments

Percent of eligible employees in establishments 

that offer health insurance

78.5

1996

1997

1998

1999

50% or more Less than 50%

79.2 77.6

60.3

50.7

46.0 48.1

86.7

82.2 79.9 81.4

Percent of low-wage employees in establishment

Percent
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Within establishments offering

health insurance, the percent of

employees enrolled slipped from

69.5% in 1996 to 64.6% in 1999.

During the same period, however,

there were increases in the portion of

establishments offering insurance and

in the portion of employees working

in those establishments.

• The proportion of full-time

workers enrolled was down from

77.9% to 73.9% over the period.

The proportion of part-time

employees with coverage dropped

by more than one-third (from

21.5% in 1996 to 13.6% in 1999).

• Workers in establishments where

50% or more of the employees

were low wage posted a dramatic

decline in the percent

enrolled–from 45.0% in 1996 to

29.8% in 1999.

• The percent actually enrolled of

those who were eligible for

coverage also fell—from 85.5% in

1996 to 82.3% in 1999.

Agency for Healthcare Research and Quality

9

Medical Expenditure Panel Survey

What percent of workers in establishments

that offered health insurance were enrolled?

0

10

20

30

40

50

60

70

80

90

45.0

69.5

85.5

66.7

33.7

84.2

Percent of enrolled employees

in establishments that offer health insurance

66.2

29.9

85.3

65.9

29.8

82.3

64.6

1996 1997 1998 1999

Percent

Eligible employees, all establishments

Total employees, establishments with 

less than 50% low-wage employees

Total employees, all establishments

Total employees, establishments with 50% 

or more low-wage employees

73.8

68.9 66.5

0

10

20

30

40

50

60

70

80

0

10

20

30

40

50

60

70

80

0

10

20

30

40

50

60

70

80

Full-time

Percent of enrolled employees in establishments

that offer health insurance

1996

1997

1998

1999

Part-time

77.9 76.1 73.7 73.9

Percent

21.5

16.5 17.9

13.6
Medical Expenditure Panel Survey Agency for Healthcare Research and Quality

11

Characteristics

of Offers

There is substantial variety in

the health insurance arrangements

that employers make available to

their workers. An employer might

offer only one type of plan or more

than one type. Additionally, an

employer can choose to pay the full

premium or require its employees to

contribute to the plan cost. The

options offered by employers are

important when examining the

coverage that workers ultimately

obtain.

section 2
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. . .

Slightly less than 30% of

establishments offering health

insurance gave their employees two

or more health insurance options in

1999. This rate was up substantially

from 1996, when only 21.5% (not

shown) offered multiple plans.

Breakdowns by establishment

characteristics matched the overall

trends.

Note that establishments having

more than one plan may be offering

different types of insurance to

separate groups of workers rather

than giving a choice of plans to

workers within a group. For instance,

if salaried employees and hourly

workers are offered different health

insurance coverage, it counts as two

plans even though no individual

employee has a choice of plans.

• In 1999, establishments that

were part of firms with more

than one location; those with a

union presence; and those in the

industry groups transportation,

communication, and utilities and

finance, insurance, and real estate

were much more likely than

average to offer more than one

plan.

• The percent of employees

working in establishments

offering multiple plans also

jumped—from 43.5% in 1996 to

56.2% in 1999 (not shown).

Agency for Healthcare Research and Quality

13

Medical Expenditure Panel Survey

How common was it for employers to

offer a choice of health insurance plans?

National average 29.7%

Multi/single status

68.0

0

10

20

30

40

50

60

70

0

10

20

30

40

50

60

70

0

10

20

30

40

50

60

70

Union presence

Percent of establishments that offer two or 

more health insurance choices, 1999

Has union employees

No union employees

2 or more locations

1 location only

Agriculture, fishing, and forestry

Construction

Retail trade

Transportation, communication,

and utilities

Finance, insurance, and

real estate

Selected industry group

24.9

14.1

53.2

13.6

Percent

14.4

35.8

41.4

48.8
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Agency for Healthcare Research and Quality

14

Medical Expenditure Panel Survey

What type of health insurance plan was

most frequently selected?

For both single and family

coverage, an employee was much

more likely to be enrolled in a

mixed-provider plan than in either of

the other types. This held true over

the three years from 1997 to 1999.

(Data for 1996 were not available.)

The different type of health plans are

described in the definitions at the

beginning of this report.

In 1999, enrollment in mixedprovider plans stood at 59.4% for

single coverage and 60.8% for family

coverage. 

• Not only was mixed-provider the

most common plan type, but the

percent of total enrollees in those

plans rose from 1997 to 1999.

For single coverage, enrollment

in mixed-provider plans stood at

59.4% in 1999, up from 53.6% in

1997. Similarly, mixed-provider

plans accounted for 60.8% of

family coverage in 1999, up from

54.5% in 1997.

• Exclusive-provider plans—with

enrollment at 30.3% of all single

coverage and 28.3% of all family 

coverage in 1999–were the

second most popular option each

year. The percent covered under

these plans went down slightly

over the 3 years.

Type of plan:

Exclusive provider

Mixed provider

Any provider

30.5%

54.5%

29.1%

14.9%

33.2%

53.6%

36.0%

13.2%

1997

28.3%

60.8%

35.8%

11.0%

30.3%

59.4%

51.2%

10.3%

1999

Employee health insurance enrollment

Single coverage Family coverage
• Any-provider enrollment as a

portion of the total was on the

decline for both single and family

coverage groups during the

period.

• The share of employees enrolled

in different types of plans was

consistent with the relative rates

at which establishments offered

them. In 1999, for example,

64.1% of establishments offered a

mixed-provider option, 37.7%

had an exclusive-provider option,

and 18.7% had an any-provider

option. (The sum of these

percents is greater than 100

because some employers offer

more than one type of plan.)

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Agency for Healthcare Research and Quality

15

Medical Expenditure Panel Survey

What type of health insurance plan was

most frequently selected? (continued)

37.7

0

10

20

30

40

50

60

70

0

10

20

30

40

50

60

70

0

10

20

30

40

50

60

70

Exclusive provider

Employer health insurance offerings, 1999

Mixed provider Any provider

64.1

18.7

Type of plan

Percent
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In 1999, 48.5% of private-sector

establishments offered their

employees at least one health

insurance plan that provided single

coverage without an employee

contribution to the premium cost.

This percentage was down from

1996. Only 29.0% of establishments

offered health insurance coverage for

families without any employee

contribution in 1999. This figure

also dropped from the 1996 rate.

• Among establishments offering

single coverage that did not

require an employee

contribution, only any-provider

plans (data not shown) were

offered less frequently in 1999

(8.6%) than in 1996 (15.3%). 

• The same pattern by plan type

held true for family-coverage

plans.

Agency for Healthcare Research and Quality

16

Medical Expenditure Panel Survey

How often did establishments offer health

insurance coverage that did not require an

employee contribution?

50.8

0

10

20

30

40

50

60

0

10

20

30

40

50

60

0

10

20

30

40

50

60

Single coverage

Percent of establishments offering health

insurance requiring no employee contribution

48.5 1996

1997

1998

1999

Family coverage

51.2 49.2

30.9 28.7 28.9 29.0

Percent
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• Actual enrollment in singlecoverage plans not requiring an

employee contribution—as a

percent of all those with single

coverage—declined over the 4-

year period, going from 37.1% to

33.5%.

• There was no significant

difference between 1996 and

1999 in the portion of enrollees

with family coverage who were

in plans not requiring a

contribution from the worker.

Agency for Healthcare Research and Quality

17

Medical Expenditure Panel Survey

How often did establishments offer health

insurance coverage that did not require an

employee contribution? (continued)

37.1

0

5

10

15

20

25

30

35

40

0

5

10

15

20

25

30

35

40

0

5

10

15

20

25

30

35

40

Single coverage

Percent of enrolled employees with health insurance 

requiring no employee contribution

33.5 1996

1997

1998

1999

Family coverage

37.6

35.0

19.3 18.5 18.7 17.3

Percent
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Not only were employees less

likely to be enrolled in health

insurance plans in 1999 than 1996,

but there also was a shift in

enrollment from family coverage to

less expensive single coverage.

• Private-sector employees in

single-coverage health insurance

plans rose from 43.9% of the

total enrolled in 1996 to 48.2%

in 1999. Most of this change

occurred from 1996 to 1997,

when single enrollment rose to

48.1%.

• Conversely, workers enrolled in

family coverage declined from

56.1% of the total to 51.8%.

• These changes were across the

board, encompassing all industry

groups, employee types, and

other attributes.

Agency for Healthcare Research and Quality

18

Medical Expenditure Panel Survey

How does enrollment in single-coverage plans

compare to enrollment in family coverage?

1996

0

10

20

30

40

50

60

70

80

90

100

0

10

20

30

40

50

60

70

80

90

100

0

10

20

30

40

50

60

70

80

90

100

Percent of enrolled employees with single or family coverage

Family coverage

Single coverage

1997

56.1 51.9 51.7 51.8

Percent

43.9

48.1 48.3 48.2

1998 1999
Medical Expenditure Panel Survey Agency for Healthcare Research and Quality

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19

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Premiums and

Employee

Contributions

The cost of health insurance—

both to the employers offering

coverage and to their employees

who may pay part of that expense—

plays a critical role in determining

who ultimately is covered. The key

cost factor is whether coverage is for

the employee only or also

encompasses members of the

employee’s family. Health insurance

premiums also vary appreciably

based on the characteristics of the

employer and of the health plan

itself. Amounts that workers have to

contribute in order to receive

coverage also vary widely. During

the 1996-99 time period covered by

this report, both premiums and

employee contributions were on the

rise throughout the United States,

but they were not increasing at the

same rate for everyone.

section 3

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Total health insurance premiums

are the fees paid for coverage of

medical benefits over a defined

benefit period. Either the employer

or the employee can pay the

premium for job-related coverage in

its entirety, or the cost can be shared

by both. 

• Average annual health insurance

premiums per enrollee for single

coverage rose 16.7% during the

period. The average annual

premium increased from $1,992

in 1996 to $2,325 in 1999, with

the largest percent increase

(6.9%) occurring in the most

recent year. 

• Average premiums were higher

for establishments in small firms

(less than 50 employees) than for

establishments in firms with 50

or more employees. This

difference was observed in each

year of the 1996-99 period but

was most pronounced in 1999.

Agency for Healthcare Research and Quality

20

Medical Expenditure Panel Survey

How fast have health insurance premiums

for single coverage been rising?

$1,900

$2,000

$2,100

$2,200

$2,300

$2,400

$2,500

$1,965

$1,992

$2,051

$2,030

Average annual premium for single-coverage

health insurance

$2,174

$2,152

$2,235

$2,475

$2,269

1996 1997 1998 1999

Dollars

Firm size:

Less than 50 employees

All private-sector employees

50 or more employees

$2,070

$2,108

$2,325
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While health insurance

premiums increased across the board

during the period 1996-99, certain

types of employers consistently

reported higher premiums than

others. Even among establishments

with similar characteristics, premiums

can vary for a number of reasons,

including the generosity of the health

plan benefits, the physical location of

the establishment, and the age and

health status of the workforce. For

example, insurance premiums vary

significantly across States.1

• Establishments where there was a

union presence had higher

premiums per enrollee than

nonunion establishments. In

1999, the average annual 

1Information on State differences is given in

MEPS Chartbook No. 7 (Branscome JM, Brown

E. State differences in job-related health

insurance, 1998. Rockville (MD):Agency for

Healthcare Research and Quality; 2001. AHRQ

Pub. No. 01-0036).

premium for employers with a

union presence was $2,468,

while the comparable premium

for nonunion establishments was

$2,296.

• Premiums have been above the

national average during this 4-

year period for health insurance

plans offered by the following

industry groups: mining; finance,

insurance, and real estate;

transportation, communication,

and utilities.

• Premiums have been below

average in these industry groups:

retail trade; agriculture, fishing,

and forestry; manufacturing.

Agency for Healthcare Research and Quality

21

Medical Expenditure Panel Survey

What types of establishments had the

highest single premiums?

$2,468

$2,050

$2,100

$2,150

$2,200

$2,250

$2,300

$2,350

$2,400

$2,450

$2,500

$2,550

$2,050

$2,100

$2,150

$2,200

$2,250

$2,300

$2,350

$2,400

$2,450

$2,500

$2,550

$2,050

$2,100

$2,150

$2,200

$2,250

$2,300

$2,350

$2,400

$2,450

$2,500

$2,550

Union presence

Average annual premium for single-coverage

health insurance, 1999

Has union employees

No union employees

Mining

Finance, insurance, and real estate

Transportation, communication,

and utilities

Retail trade

Agriculture, fishing, and forestry

Manufacturing

Selected industry group

$2,296

$2,413

$2,345

Dollars

$2,233

$2,216

$2,201

National average $2,325

$2,485
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One of the most important

factors determining the health

insurance premium is the type of

providers covered by the plan.

Premiums increased from 1996 to

1999 regardless of the type of

provider arrangement offered by the

plans, but they increased at different

rates.

• Plans that allow enrollees to go

to any provider had the largest

increase in single premiums

during this period (25.9%) and

had the highest annual single

premium of the three groups

($2,581 in 1999). 

• Plans that require enrollees to use

an exclusive set of in-plan

providers had the smallest overall

increase (13.6%) and had the

lowest annual single premium of

the three groups ($2,171 in

1999). 

• Plans that provide a list of

preferred providers but allow

enrollees to go to providers

outside the plan (at a higher cost)

had premium increases for single

coverage that were in between

those for exclusive-provider plans

and any-provider plans. Over the

4-year period, single premiums

for mixed-provider plans

increased 16.9%. The annual

single premium for these plans in

1999 was $2,359.

Agency for Healthcare Research and Quality

22

Medical Expenditure Panel Survey

Did single premiums rise equally fast for

all types of health insurance plans?

$1,800

$1,900

$2,000

$2,100

$2,200

$2,300

$2,400

$2,500

$2,600

$1,912

$2,019 $2,051

$1,916

$2,224

Average annual premium for single-coverage

health insurance

$2,174

$2,008

$2,368

$2,224

$2,171

$2,581

$2,325

1996 1997 1998 1999

Dollars

Type of plan:

Any provider

Mixed provider

All plans

Exclusive provider

$1,992

$2,091

$2,359

$2,050
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While some job-based health

insurance premiums are paid entirely

by the employer, the most common

arrangement is for the premium cost

to be shared by the employer and

enrolled employees. As premiums

increase, one way that employers can

reduce their rising burden is by

asking the employees to pick up a

larger amount of the premium.

• Employers, in general,

maintained a relatively constant

level of cost sharing with their

employees who were enrolled in

single-coverage plans over this 4-

year period. While the average

annual dollar amount paid by

employees rose from $342 to

$420, as a percentage of the

total premium, the increase was

less than 1 percentage point

(from 17.2% to 18.1%). 

• Employee contributions jumped

from 17.4 to 19.1% of the

premium for exclusive-provider

plans, the only plan type that

experienced a significant increase

over this time period. 

Agency for Healthcare Research and Quality

23

Medical Expenditure Panel Survey

Have the enrollee contributions for single

coverage changed?

18.1

0

5

10

15

20

25

0

5

10

15

20

25

0

5

10

15

20

25

All plans

Enrollee contribution as a percent of single-coverage

health insurance premium

17.6

1996

1997

1998

1999

Exclusive provider Mixed provider

17.2

15.6

17.4

16.4

17.9

19.1

17.5

15.3

17.9

Type of plan

Percent

17.9

16.1

15.1

16.1 16.6

Any provider
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Employee contribution rates can

vary because of a number of different

employer or employee characteristics. 

• Establishments with a union

presence required a smaller

contribution from plan enrollees.

In 1999, establishments with a

union presence required an

average employee contribution of

$319 (12.9% of the total

premium), while nonunion

establishments required an

average contribution of $435

(18.9% of the total premium). 

• The retail trade industry group

required a larger dollar enrollee

contribution than the all-industry

average.

• Lower than average dollar

contributions from their

employees were the norm in the

following industries:

• Manufacturing.

• Transportation,

communication, and utilities.

• Agriculture, fishing, and

forestry.

Agency for Healthcare Research and Quality

24

Medical Expenditure Panel Survey

In what types of establishments did employees

contribute the most for single coverage?

$319

100

200

300

400

500

600

700

100

200

300

400

500

600

700

100

200

300

400

500

600

700

Union presence

Enrollee contribution to single-coverage

health insurance premium, 1999

Has union employees

No union employees

Retail trade

Manufacturing

Transportation, communication,

and utilities

Agriculture, fishing, and forestry

Selected industry group

$435

$392

Dollars

$334

$279

National average $420

$589
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Average premiums for family

coverage in health insurance plans

increased considerably during the

period 1996-99, and they increased

regardless of the type of provider

arrangement covered by the plans. 

• The average annual family

premium increased from $4,954

in 1996 to $6,058 in 1999. This

22.3% increase was higher than

the increase for single premiums

(16.7%) over the same time

period. 

• Plans that allow enrollees to go

to any provider had the largest

family premium increases during

this period (31.3%) and had the

highest average annual family

premiums of the three groups

($6,466 in 1999). 

• Plans that require enrollees to use

an exclusive set of in-plan

providers had the smallest overall

increase (18.1%) and had the

lowest average annual family

premiums of the three groups

($5,749 in 1999). 

• Plans that provide a list of

preferred providers but allow

enrollees to go to providers

outside the

plan (at a

higher cost)

had premium

increases for

family coverage

that were

greater than

those of the

exclusiveprovider plans but less than those

of the any-provider plans. Over

the 4-year period, family

premiums for these mixedprovider plans increased 22.4%.

The average annual family

premium for these plans in 1999

was $6,128.

Agency for Healthcare Research and Quality

25

Medical Expenditure Panel Survey

How fast have health insurance premiums

for family coverage risen?

$4,800

$5,000

$5,200

$5,400

$5,600

$5,800

$6,000

$6,200

$6,400

$6,600

$4,868 is exclusive provider

$4,954 is all plans

$5,332

$5,152

$5,450

Average annual premium for family-coverage

health insurance

$5,590

$5,302

$5,754

$5,701 $5,749

$6,466

$6,058

1996 1997 1998 1999

Dollars

Type of plan:

Mixed provider

All plans

Any provider

Exclusive provider

$4,924 is any provider

$5,401

$6,128

$5,007 is mixed provider
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Family premium costs varied

greatly depending on industry

group.

• Family premiums were above the

all-industry average for health

insurance plans offered by the

following industry groups:

• Finance, insurance, and real

estate.

• Mining.

• Premiums have been below

average in these industries:

• Retail trade.

• Agriculture, fishing, and

forestry.

• Construction.

• Unlike single premiums, family

premiums did not vary

significantly by size of firm or

presence of a union.

Agency for Healthcare Research and Quality

26

Medical Expenditure Panel Survey

What types of establishments had the

highest family premiums?

$6,382

$5,200

$5,400

$5,600

$5,800

$6,000

$6,200

$6,400

$6,600

$5,200

$5,400

$5,600

$5,800

$6,000

$6,200

$6,400

$6,600

$5,200

$5,400

$5,600

$5,800

$6,000

$6,200

$6,400

$6,600

Selected industry group

Average annual premium for family-coverage

health insurance, 1999

Finance, insurance, and

real estate

Mining

Retail trade

Agriculture, fishing, and

forestry

Construction

$6,299

$5,772 $5,711

$5,614

Dollars

National average $6,058
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The average amount paid by

enrollees for family coverage

increased significantly, from $1,276

(not shown) to $1,438 over this

4-year period. But the percentage of

the total premium paid by the

employees actually decreased by 2

percentage points, from 25.7% to

23.7%.

• Only exclusive-provider plans

failed to show a significant

decrease in the employee

contribution percentage over this

4-year period. 

• The dollar amount of the

employee contribution (not

shown) for family coverage did

not rise significantly over the 4-

year period for any-provider plans

but did rise for both exclusiveand mixed-provider plans.

• Since family-coverage premiums

are much higher than singlecoverage premiums, most

employers require that employees

contribute more toward family

coverage, both in terms of the

dollar amount and as a

percentage of the total premium.

For example, in 1999, the

average employee contribution

for family coverage was $1,438

(23.7% of the premium)

compared with $420 (18.1% of

the premium) for single coverage.

Agency for Healthcare Research and Quality

27

Medical Expenditure Panel Survey

Have employee contributions for family

coverage risen at the same rate as the premiums?

25.4

0

5

10

15

20

25

30

0

5

10

15

20

25

30

0

5

10

15

20

25

30

All plans

Enrollee contribution as a percent of family-coverage 

health insurance premium

24.7

1996

1997

1998

1999

Exclusive provider Mixed provider

25.7 24.5 23.7

26.5

25.426.1 26.2 24.8 25.1

23.9

Type of plan

Percent

23.2

21.4 20.7

19.4

Any provider
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Employee contribution rates vary

because of a number of different

employer or employee characteristics. 

• For each year of the survey,

establishments with a union

presence required a lower

contribution for family coverage

from plan enrollees. In 1999,

establishments with unions

required an average employee

contribution of $922 (15.0% of

the premium), while nonunion

establishments required an

average contribution of $1,604

(26.6% of the premium).

• Enrollee dollar contributions for

family coverage have been above

the all-industry average for health 

insurance plans offered by the

following industry groups:

• Retail trade.

• Finance, insurance, and real

estate.

• Services.

• Lower than average dollar

contributions from employees

were required in the following

industries:

• Agriculture, fishing, and

forestry. 

• Manufacturing.

• Transportation,

communication, and utilities.

• Mining.

Agency for Healthcare Research and Quality

28

Medical Expenditure Panel Survey

In what types of establishments did employees

contribute the most for family coverage?

$922

400

600

800

1000

1200

1400

1600

1800

2000

400

600

800

1000

1200

1400

1600

1800

2000

400

600

800

1000

1200

1400

1600

1800

2000

Union presence

Enrollee contribution to family-coverage health

insurance premium, 1999 Has union employees

No union employees

Retail trade

Finance, insurance, and real estate

Services

Agriculture, fishing, and

forestry

Manufacturing

Transportation, communication

and utilities

Mining

Selected industry group

$1,604

Dollars

$1,753

$1,667

$1,630

$1,429 National average $1,438

$1,128

$1,014

$916
Medical Expenditure Panel Survey Agency for Healthcare Research and Quality

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29

Future MEPS

Data on JobRelated

Health

Insurance

Annual MEPS data on jobrelated health insurance for the years

1996 through 2000 are currently

available on the MEPS Web site.

The Insurance Component of

MEPS is conducted annually. As

additional years of data become

available, changes in plan offerings,

enrollments, and costs of employersponsored health insurance can be

studied in greater detail.

looking ahead
www.ahrq.gov

AHRQ Publication No. 02-0030

July 2002

ISBN 1-58763-119-9

ISSN 1531-5649

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