Access Cost Choice

www.ahrq.gov

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State Differences in Job-Related

Health Insurance, 1998

MEPS Chartbook No. 7

Medical Expenditure Panel Survey
Suggested citation:

Branscome JM, Brown E. State differences in job-related health insurance, 1998. Rockville (MD):Agency for Healthcare Research

and Quality; 2001. MEPS Chartbook No. 7. AHRQ Pub. No. 01-0036.

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

MEPS Chartbook No. 7 by:

James M. Branscome, M.S.

Erwin Brown, Jr., B.S.

‡

MT ND

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TX

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AR

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MS AL

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NC

VA

WI MI

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KY

IL IN OH

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Medical Expenditure Panel Survey Agency for Healthcare Research and Quality

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i

Definitions of terms used in this chartbook

Establishment—A particular workplace or location.

Firm—A company or business.A firm can have many establishments or only one.

Small firm—A firm with fewer than 50 employees.

Large firm—A firm with 50 or more employees.

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.

Total premium—Total amount paid for insurance, consisting of contributions by both the employee and employer.

Conventional indemnity plan—A type of health insurance plan that allows the enrollee the choice of any provider without effect on reimbursement.

These plans reimburse the patient and/or provider as expenses are incurred.The plan does not have a specific network of health insurance providers

associated with it.

Managed care plan—A type of health insurance plan that generally provides comprehensive health services to its enrollees and offers financial

incentives for patients to use the providers who belong to the plan. Managed care plans include both exclusive provider plans and preferred provider

plans.

Exclusive provider plan—A managed care plan, such as a health maintenance organization, in which enrollees must use providers from the specified

network of physicians and hospitals to receive coverage; there is no coverage for care received from a non-network provider, except in an emergency.

Preferred provider plan—A managed care plan, such as a preferred provider organization, where coverage is provided to enrollees through a network

of selected health care providers (such as hospitals and physicians).The enrollees may go outside the network, but they would pay a greater percentage of

the cost of the coverage than if they stayed within the network.

Level of significance—States where the estimates are statistically significantly different from the national average at the 0.05 level are noted with a star

on the maps.The alpha level of 0.05 is based on simultaneously testing whether each State is different from the national average.
iii

Establishments in Hawaii were the most

likely to offer job-related insurance to at

least some of their employees. State law

in Hawaii mandates that employers offer

health insurance and pay for at least half

of the premium for most workers. (See

Note 2.)

In every State, establishments in large

firms were more likely to offer health

insurance than those in small firms.

Differences in health insurance offer

rates between the States are driven

primarily by offer rates in small firms in

those States.

Establishments in Alaska, Idaho,

Wyoming,Arkansas, Mississippi,

Oklahoma, Nebraska, Louisiana, New

Mexico, and Texas were the least likely

to offer insurance to their employees.

The national average premium was

$2,174 for single coverage and $5,590 for

family coverage.

For both single and family coverage,

total premiums were highest in the

Northeastern United States. Premiums

tended to be lowest in the South and

Midwest.

Medical Expenditure Panel Survey Agency for Healthcare Research and Quality

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executive summary

Employees in Massachusetts made the

highest contributions for single

coverage. For family coverage, the

highest contributions were made by

employees in the District of Columbia,

Florida, and Texas.

This report presents estimates of workers’ access to job-related health insurance,

the cost of that insurance, and the choice of plans available to workers in 1998. (See

Note 1.) Key findings include:

Access

Cost

Approximately 68% of establishments in

the Nation offered workers only one

plan. Establishments in California and

Hawaii were the most likely to offer a

choice of health insurance plans to their

employees.

Conventional indemnity plans were

most common in Wyoming,Alaska, and

Idaho. Managed care plans do not have

a strong presence in these States.

Choice

In general, exclusive provider health

insurance plans (such as health

maintenance organizations) were most

commonly offered in the Northeast and

on the West coast. Preferred provider

plans (such as preferred provider

organizations) were more frequently

offered in the South and Midwest.
1 Introduction

3 Data in This Report

7 Section 1

Access

15 Section 2

Cost

21 Section 3

Choice

27 Looking Ahead

28 References

29 Notes

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contents

v
Employer-sponsored health

insurance is the primary source of

health insurance for most Americans.

While enrollment in public health

insurance programs has increased from

1987 to 1998, job-related coverage

remains the most crucial aspect of

insurance coverage for Americans

today. Job-related coverage can vary

significantly based on employer

characteristics such as type of industry,

length of time in business, number of

full- and part-time workers, salary

levels of the workers, and the physical

location of the establishment—the last

of which is the focus of this report.

Employer-sponsored coverage

varies significantly across States, so data

on trends in coverage at the State level

are critical to understanding who is and

who is not covered by employersponsored health insurance. In recent

years, States have been increasingly

active in crafting policies for their

residents who lack health insurance

coverage. In the early 1990s, most

States established reforms to encourage

more small firms to offer insurance to

their workers. At the same time, States

expanded Medicaid’s eligibility

thresholds. In 1997, Congress enacted

the State Children’s Health Insurance

Program (SCHIP), which gave States

the funding and flexibility to extend

public insurance coverage to more

uninsured children. This report

addresses three key aspects of State

differences in employer-sponsored

health insurance.

The first section looks at workers’

access to job-related health insurance.

The cost of insurance, which may be a

factor in whether employers offer

coverage and whether workers accept

it, is examined in the second section.

Finally, the report presents data on the

choice of plans offered to employees.

Medical Expenditure Panel Survey Agency for Healthcare Research and Quality

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introduction

1
Data in this

Report

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 with more than

29,000 responding private-sector

establishments and State and local

governmental units. 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 the 27,000

responding private-sector

establishments and are drawn from

more detailed tables that appear on

the MEPS Web site:

http://www.meps.ahrq.gov/

data_pub/ic_toc.htm

The MEPS IC is an annual

survey, but State-level estimates

cannot be produced in every State for

every survey year because of budget

constraints. Although data are

collected in each State each year in

order to make a reliable national

estimate, sample sizes in States with

smaller populations can support Statelevel estimates only in years when their

samples are specifically increased for

that purpose. The survey began in

1996 and produced estimates that

year for the 40 States with the largest

populations. In 1997, the MEPS IC

sample started a rotation of the 20

least populated States so that every

State would have an adequate sample

size to make State-level estimates at

least once every 4 years.

The following States do not have

estimates for 1998: Alaska, the District

of Columbia (which is treated by the

MEPS IC survey as a State), Hawaii,

Maine, Mississippi, Montana, Nevada,

North Dakota, Rhode Island, South

Dakota, and Vermont. However, in

order to provide the most current

information available, 1997 State-level

estimates for the District of Columbia,

Alaska, Hawaii, Maine, Mississippi,

Nevada, and Rhode Island are

included in this chartbook. For . . . . . . . ..............

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Agency for Healthcare Research and Quality 3

Medical Expenditure Panel Survey

data in this report
analytical consistency, the maps

show the 1997 estimates for these

States in comparison to the 1997

national estimates, not 1998. For

example, the percentage of

establishments offering health

insurance in Rhode Island in

1997 (54.0%) was slightly above

the 1997 national average

(52.4%). In 1998, the national

average increased to 55.2%.

However, the map will show

Rhode Island as being above the

national average because it was

above the national average in

1997.

There are no State-level

estimates from previous survey

years for the four remaining

States—Montana, North Dakota,

South Dakota, and Vermont. The

MEPS IC survey for 1999 will

provide estimates for Montana

and Vermont, and the 2000

survey will provide estimates for

North and South Dakota.

For each map, the 47 States

for which estimates are available

(40 States with 1998 estimates

and 7 States with 1997 estimates)

are classified based on whether

they are at or above the national

average or below the national

average. They are shaded

accordingly. States where the

estimates are statistically

significantly different from the

national average at the 0.05 level

are noted with a star. For

statistical purposes, these

significance tests are performed

on all 47 States at the same time.

(See Note 3.)

Unless otherwise noted, only

differences that are statistically

significant at the 0.05 level are

discussed in the text. When a

State is described as having one of

the highest or lowest rates, this

means that it is significantly above

or below the national average,

but not necessarily that it is

significantly different from other

States. For example, New York

had the highest average family

premium ($6,453) in 1998.

While this is statistically different

from the national average

($5,590), it is not statistically

larger than the average family

premiums for a number of other

States, such as Connecticut

($6,380), New Jersey ($6,332),

and New Hampshire ($6,185).

However, one could say that New

York had the highest family

premiums for job-based health

insurance.

It is also important to note

that differences among States in

the size of the standard errors for

estimates can result in what

appear to be inconsistent results.

For example, Alaska has the

highest single yearly premium

($2,558), but this premium is not

significantly above the national

average of $2,174 because of the

large standard error for the Alaska

estimate ($217). However, the

District of Columbia, with a

yearly single premium of $2,455,

is significantly above the national

average because it has a much

smaller standard error ($45) than

Alaska, even though the District

of Columbia estimate is smaller

than the Alaska estimate.

All comparisons made in this

chartbook are between State and

Agency for Healthcare Research and Quality

4

Medical Expenditure Panel Survey
national estimates. This is the

second MEPS Chartbook to

present State-level data on jobrelated health insurance. The

first—MEPS Chartbook Number 4:

“State Differences in Job-Related

Health Insurance, 1996,” by

Peterson and Vistnes—was based

on the initial set of 1996 MEPS

IC tables. Subsequent to the

publication of that chartbook, the

1996 tables were expanded and

revised based on:

• Improved imputation

methods that used additional

data collected during the

second year of the survey.

• Modifications of the

weighting methodology to

better control for known

industry totals.

• Availability from the Census

Bureau’s Standard Statistical

Establishment List of more

precise values for firm size for

the time period covered.

The general findings

presented in that first chartbook

are still valid, but many of the

percentages reported changed

slightly between the preliminary

and final tables. Unlike the first

chartbook, all references to 1996

data in this report specifically

pertain to estimates from the final

1996 tables.

The premium data in MEPS

do not assume a standardized

package of benefits for all health

insurance plans. Because plans

offer various benefits, higher

premiums in a State may indicate

that the plans in that State offer

more generous benefits. The

variations in premiums by State

also may reflect differences in

medical costs, enrollment patterns,

State regulations, and plan types.

In this report, “establishment” refers to a particular

workplace or location. “Firm”

refers to a company or business. A

firm can have many establishments

or only one. “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.

Specific sources for additional

information presented in the

discussion are listed in the

references section. Besides the

Insurance Component, MEPS

includes components on

households, medical providers,

and nursing homes. With all of its

components, MEPS is a nationally

representative group of surveys

that collect detailed information

on health status, health care use

and expenses, and health insurance

coverage of individuals and

families in the United States.

Medical Expenditure Panel Survey Agency for Healthcare Research and Quality

5
Access Job-related health insurance plays

a critical role in covering American

workers and their families. Yet many

workers may not receive needed

medical care and are exposed to

catastrophic financial risks because they

do not have access to such coverage. In

fact, among working-age Americans

who are uninsured, more than twothirds are employed (Vistnes and

Monheit, 1997).

Medical Expenditure Panel Survey Agency for Healthcare Research and Quality

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section 1

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Agency for Healthcare Research and Quality

8

Medical Expenditure Panel Survey

• Establishments were most likely to

offer insurance to at least some of

their employees in Hawaii (83.3%),

where employers are mandated by

State law to offer coverage to most

workers. (See Note 2.)

• The other States where

establishments were most likely to

offer health insurance were the

District of Columbia (73.7%), New

Hampshire (66.1%), Massachusetts

(63.9%), and Pennsylvania (63.3%).

• Ten States were significantly below

the national average for

establishments offering health

insurance. They were Alaska

(42.2%), Idaho (42.4%), Wyoming

(44.1%), Arkansas (44.4%),

Mississippi (45.3%), Oklahoma

(46.0%), Nebraska (46.2%),

Louisiana (46.8%), New Mexico

(47.5%), and Texas (49.6%).

• Nationally, the percentage of

establishments offering health

insurance was 55.2% in 1998, up

from 52.4% in 1997.

In which States are establishments most likely

to offer health insurance to their workers?

Percent of private-sector establishments that offer health insurance, 1998

National average = 55.2%

At or above national average, 55.2%-83.3%

Below national average, 42.2%-55.1%

Significantly different from national average

Data not available

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District of Columbia

Estimates for Alaska, the District of Columbia,

Hawaii, Maine, Mississippi, Nevada, and Rhode

Island are based on 1997 survey data. See Note 1

for details.
Percent of private-sector establishments that offer health insurance, 1998

Large firms

National average = 96.3%

At or above national average, 96.3%-99.3%

Below national average, 84.8%-96.2%

Significantly different from national average

Data not available

★

★

★

★ District of Columbia

Estimates for Alaska, the District of Columbia, Hawaii,

Maine, Mississippi, Nevada, and Rhode Island are based

on 1997 survey data. See Note 1 for details.

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• In every State, establishments that

were part of large firms (50 or

more employees) were more likely

than those in small firms to offer

health insurance.

• Most of the State differences in

health insurance offer rates occur in

small firms (fewer than 50

employees).

Agency for Healthcare Research and Quality

9

Are large-firm establishments more likely

to offer health insurance?

Percent of private-sector establishments that offer health insurance, 1998

Small firms

National average = 43.7%

At or above national average, 43.7%-78.9%

Below national average, 29.6%-43.6%

Significantly different from national average

Data not available

★

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District of Columbia

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★

Estimates for Alaska, the District of Columbia, Hawaii,

Maine, Mississippi, Nevada, and Rhode Island are based

on 1997 survey data. See Note 1 for details.

Medical Expenditure Panel Survey
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When an establishment offers

insurance, not all of its workers may be

eligible for coverage. Part-time

employees may be ineligible. New

employees may be excluded until they

have completed a waiting period.

Workers with pre-existing conditions

may not be eligible for coverage

immediately. (See Note 4.)

• Employees in establishments

offering insurance were most likely

to be eligible for coverage in the

District of Columbia (86.4%).

None of the other States were

significantly different from the

national average.

• Nationwide, the percent of

employees eligible for insurance in

establishments that offer health

insurance has decreased from

81.3% in 1996 to 77.6% in 1998.

Agency for Healthcare Research and Quality

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Medical Expenditure Panel Survey

When health insurance is offered at the

workplace, does the likelihood that workers

will be eligible for coverage vary by State?

Percent of employees eligible for insurance in establishments that offer health

insurance, 1998

National average = 77.6%

At or above national average, 77.6%-86.4%

Below national average, 71.5%-77.5%

Significantly different from national average

Data not available

★

★ District of Columbia

Estimates for Alaska, the District of Columbia,

Hawaii, Maine, Mississippi, Nevada, and Rhode

Island are based on 1997 survey data. See Note 1

for details.
Note: The estimate for Missouri has a standard error that exceeds 30% of the

estimate. It does not meet the standard for reliability or precision.

Estimates for Alaska, the District of Columbia, Hawaii, Maine, Mississippi, Nevada,

and Rhode Island are based on 1997 survey data. See Note 1 for details.

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• The difference in eligibility

between full-time and part-time

employees was significant in every

State.

• The gaps in the eligibility rates

between full- and part-time

employees were smallest in Hawaii

(92.0% for full-time, 51.5% for

part-time) and Tennessee (85.2%

for full-time, 44.7% for part-time),

although these differences were

still significant.

• The gaps were greatest in

Mississippi, Arkansas, and Alaska,

where the differences in eligibility

rates between full- and part-time

employees were 75.3, 70.5, and

70.0 percentage points,

respectively.

Agency for Healthcare Research and Quality

11

Medical Expenditure Panel Survey

Are full-time employees more likely than

part-time employees to be eligible for coverage?

Percent of employees eligible for insurance in establishments that offer health insurance, 1998

Full-time employees

National average = 85.1%

At or above national average, 85.1%-92.7%

Below national average, 81.8%-85.0%

Significantly different from national average

Data not available

★

★ District of Columbia

★

Estimates for Alaska, the District of Columbia, Hawaii,

Maine, Mississippi, Nevada, and Rhode Island are

based on 1997 survey data. See Note 1 for details.

Percent of employees eligible for insurance in establishments that offer health insurance, 1998

Part-time employees

National average = 29.2%

At or above national average, 29.2%-51.5%

Below national average, 17.0%-29.1%

Significantly different from national average

Data not available

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District of Columbia

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Even when workers were eligible

for job-related health insurance, they

may not have chosen to enroll. A

common reason for not enrolling was

that they were already covered through

their spouse’s employer. Others did not

sign up because they felt that the

amount that they would have paid for

coverage was too expensive or they

believed that they did not need health

insurance.

• Among workers eligible for

coverage through their job, those

in Washington were the most likely

to enroll (89.8%).

• Enrollment rates were significantly

below the national average in New

Mexico (80.0%), Massachusetts

(79.8%), and Utah (71.9%).

Agency for Healthcare Research and Quality

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Medical Expenditure Panel Survey

In which States are workers who are eligible

for coverage most likely to enroll?

Percent enrolled among employees eligible for job-related health insurance,

1998

National average = 85.3%

At or above national average, 85.3%-89.8%

Below national average, 71.9%-85.2%

Significantly different from national average

Data not available

★

District of Columbia

★

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Estimates for Alaska, the District of Columbia, Hawaii,

Maine, Mississippi, Nevada, and Rhode Island are based on

1997 survey data. See Note 1 for details.
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• There was a significant disparity in

enrollment rates between large and

small firms in 14 States. In all of

these cases, the enrollment rates

were higher in the large firms than

in the small firms.

• Enrollment rates in small firms

were significantly above the

national average in West Virginia

(92.3%), South Carolina (86.4%),

Washington (86.4%), and

California (84.5%).

• Small firm enrollment rates were

lowest in New Mexico (72.8%),

Massachusetts (70.8%), Wisconsin

(70.2%), and Utah (57.2%).

Agency for Healthcare Research and Quality

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Medical Expenditure Panel Survey

Are employees in small firms less likely to

enroll?

Percent enrolled among employees eligible for job-related health insurance, 1998

Large firms

National average = 86.8%

At or above national average, 86.8%-91.0%

Below national average, 78.0%-86.7%

Significantly different from national average

Data not available

★

District of Columbia

★ Rhode Island

Estimates for Alaska, the District of Columbia, Hawaii,

Maine, Mississippi, Nevada, and Rhode Island are

based on 1997 survey data. See Note 1 for details.

Percent enrolled among employees eligible for job-related health insurance, 1998

Small firms

National average = 80.1%

At or above national average, 80.1%-92.3%

Below national average, 57.2%-80.0%

Significantly different from national average

Data not available

★

District of Columbia ★

★

★

★

★

★ ★

★

Estimates for Alaska, the District of Columbia, Hawaii,

Maine, Mississippi, Nevada, and Rhode Island are

based on 1997 survey data. See Note 1 for details.
Cost Many employers may not offer

health insurance because of the cost of

premiums. Even when they do offer

coverage, the portion of the premium

that workers must pay may place such

coverage out of reach for many

Americans.

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section 2

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The total health insurance

premium for job-related coverage

consists of contributions by both the

employer and the employee. Variations

in premiums by State reflect differences

in medical costs, enrollment patterns,

State regulations, and the generosity of

health plan benefits and plan types.

• Premiums were higher than the

national average in the District of

Columbia ($2,455), Massachusetts

($2,392), New Hampshire

($2,356), and Rhode Island

($2,254).

• Premiums were below the national

average in South Carolina

($2,070), Kentucky ($1,990), and

Iowa ($1,941).

• Nationally, the average yearly

premium for single coverage

increased 3.0% from 1996 to 1997

and 6.0% from 1997 to 1998. The

average yearly single premium was

$1,992 in 1996, $2,051 in 1997,

and $2,174 in 1998.

Agency for Healthcare Research and Quality

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Medical Expenditure Panel Survey

Does the average total health insurance

premium for single coverage vary by State?

Average total annual premium for job-related health insurance, 1998

Single coverage

National average = $2,174

At or above national average, $2,174-$2,558

Below national average, $1,884-$2,173

Significantly different from national average

Data not available

★

★ District of Columbia

★

★

★

★

★

★

Rhode Island

Estimates for Alaska, the District of Columbia, Hawaii, Maine,

Mississippi, Nevada, and Rhode Island are based on 1997

survey data. See Note 1 for details.
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• Employee contributions were

lowest in Hawaii ($125), Oregon

($198), Nevada ($215),

Washington ($221), Idaho ($282),

and Pennsylvania ($289).

• Massachusetts was the only State

with an employee contribution

($531) significantly higher than

the national average of $383.

Agency for Healthcare Research and Quality

17

Medical Expenditure Panel Survey

Where do workers pay the least for single

coverage?

Average annual employee contribution for job-related health insurance, 1998

Single coverage

National average = $383

At or above national average, $383-$859

Below national average, $125-$382

Significantly different from national average

Data not available

★

District of Columbia

★

★

★

★

★

★

★

Estimates for Alaska, the District of Columbia, Hawaii, Maine,

Mississippi, Nevada, and Rhode Island are based on 1997

survey data. See Note 1 for details.
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The total health insurance

premium for job-related coverage

consists of contributions by both the

employer and the employee. Variations

in premiums by State reflect differences

in medical costs, enrollment patterns,

State regulations, and the generosity of

health plan benefits and plan types.

• Family coverage premiums exceeded

the national average in six States—

New York ($6,453), Connecticut

($6,380), New Jersey ($6,332),

New Hampshire ($6,185),

Massachusetts ($6,139), and the

District of Columbia ($6,050).

• Family coverage premiums were

below the national average in four

States—North Carolina ($4,964),

New Mexico ($4,889), Arkansas

($4,813), and Mississippi ($4,571). 

• Nationally, the average yearly

premium for family coverage

increased 7.6% from 1996 to 1997

and 4.8% from 1997 to 1998. The

average yearly family premium was

$4,954 in 1996, $5,332 in 1997,

and $5,590 in 1998.

Agency for Healthcare Research and Quality

18

Medical Expenditure Panel Survey

Does the average total health insurance

premium for family coverage vary by State?

Average total annual premium for job-related health insurance, 1998

Family coverage

National average = $5,590

At or above national average, $5,590-$6,453

Below national average, $4,571-$5,589

Significantly different from national average

Data not available

★

District of Columbia

★

★

★ ★

★

★

★

★

★

★

Estimates for Alaska, the District of Columbia, Hawaii, Maine,

Mississippi, Nevada, and Rhode Island are based on 1997

survey data. See Note 1 for details.
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• The average employee

contribution was significantly

above the national average in the

District of Columbia ($1,877),

Florida ($1,861), and Texas

($1,623).

• It was below the national average

in Pennsylvania ($1,236), Indiana

($1,107), and Ohio ($1,071).

Agency for Healthcare Research and Quality

19

Medical Expenditure Panel Survey

Do workers in different States pay the

same amount for family coverage?

Average annual employee contribution for job-related health insurance, 1998

Family coverage

National average = $1,382

At or above national average, $1,382-$1,961

Below national average, $1,022-$1,381

Significantly different from national average

Data not available

★

District of Columbia

★

★

★

★ ★

★ Estimates for Alaska, the District of Columbia, Hawaii, Maine,

Mississippi, Nevada, and Rhode Island are based on 1997

survey data. See Note 1 for details.
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• The average employee contribution

for single coverage was significantly

below the national average in

Hawaii (6.2%), Oregon (8.9%),

Nevada (10.1%), Washington

(10.5%), and Pennsylvania (13.2%).

• Nationally, the employee

contribution rate (as a portion of

the total premium) was 7.1

percentage points higher for family

coverage than for single coverage. 

• The employee contribution rate

was higher for family coverage than

single coverage in every State

except one.

• As a portion of premiums, the

national average employee

contribution rates for both single

and family health insurance plans

did not change significantly from

1996 to 1998. Employers

continued to share health insurance

costs with their employees at

approximately the same level in

1998 as in 1996.

Agency for Healthcare Research and Quality

20

Medical Expenditure Panel Survey

What percent of the premium for single

and family coverage do employees pay?

Percent of total premium for job-related health insurance paid by worker, 1998

Single coverage

National average = 17.6%

At or above national average, 17.6%-37.6%

Below national average, 6.2%-17.5%

Significantly different from national average

Data not available

★

District of Columbia

★

★

★

★

★

★

★ Estimates for Alaska, the District of Columbia, Hawaii,

Maine, Mississippi, Nevada, and Rhode Island are

based on 1997 survey data. See Note 1 for details.

Percent of total premium for job-related health insurance paid by worker, 1998

Family coverage

National average = 24.7%

At or above national average, 24.7%-34.6%

Below national average, 18.3%-24.6%

Significantly different from national average

Data not available

★

District of Columbia

★

★

★

★

★ Estimates for Alaska, the District of Columbia, Hawaii,

Maine, Mississippi, Nevada, and Rhode Island are

based on 1997 survey data. See Note 1 for details.
Choice Health insurance plans do not

differ only in premium costs. For

instance, some plans restrict enrollees’

choice of providers, while others do

not. Some plans require a higher fee

for a doctor’s visit than others. With a

choice of plans, workers can pick the

plan that best meets their needs in

terms of both benefits and costs.

Medical Expenditure Panel Survey Agency for Healthcare Research and Quality

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section 3

21
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• Establishments in California

(44.3%) and Hawaii (38.3%) were

most likely to offer their employees

a choice of health insurance plans.

• Establishments were least likely to

offer a choice of plans in Alaska

(12.4%), Mississippi (17.1%),

Nebraska (18.1%), Alabama

(19.8%), Wyoming (21.0%), Idaho

(22.0%), and Kansas (22.1%).

Multiple plan offer rates were also

significantly below the national

average in Minnesota (23.0%),

Kentucky (23.4%), Colorado

(24.0%), and North Carolina

(26.7%).

Agency for Healthcare Research and Quality

22

Medical Expenditure Panel Survey

In which States are establishments most likely

to offer a choice of health insurance plans?

Percent that have two or more plans among establishments offering health

insurance, 1998

National average = 32.4%

At or above national average, 32.4%-44.3%

Below national average, 12.4%-32.3%

Significantly different from national average

Data not available

★

District of Columbia

★

★ ★

★

★

★

★

★

★

★

★

★

★

Estimates for Alaska, the District of Columbia, Hawaii,

Maine, Mississippi, Nevada, and Rhode Island are based

on 1997 survey data. See Note 1 for details.
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In a conventional indemnity plan,

enrollees can go to the physicians of

their choice on a fee-for-service basis.

The plan does not have a network of

health care providers associated with it.

Conventional indemnity plans were

once the most common type of health

insurance plan offered to employees in

the United States but have become less

and less common in the past decade.

• In Wyoming (61.7%), Alaska

(55.0%), and Idaho (50.5%), more

than half the establishments

offering insurance offered an

indemnity plan.

• Establishments in West Virginia

(45.7%), Maine (39.7%), Rhode

Island (36.4%), Iowa (33.1%),

Michigan (32.5%), and

Pennsylvania (30.9%) also offered

conventional indemnity plans at

rates significantly above the national

average.

• Conventional indemnity plans were

least likely to be offered by

employers in Colorado (12.3%),

Missouri (12.9%), California

(14.7%), District of Columbia

(15.5%), Massachusetts (15.9%),

New Jersey (17.8%), and Nevada

(18.6%).

Agency for Healthcare Research and Quality

23

Medical Expenditure Panel Survey

Where are establishments most likely to

offer conventional indemnity plans?

Percent that have at least one conventional indemnity plan among establishments

offering health insurance, 1998

National average = 22.8%

At or above national average, 22.8%-61.7%

Below national average, 12.3%-22.7%

Significantly different from national average

Data not available

★

District of Columbia

★

★

★

★

★

★

★

★

★

★

★

★

★

★

★ ★

Rhode Island

Estimates for Alaska, the District of Columbia, Hawaii,

Maine, Mississippi, Nevada, and Rhode Island are based

on 1997 survey data. See Note 1 for details.
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In a managed care plan, enrollees

are restricted in their choice of providers

or have a financial incentive to go to a

preferred provider. Managed care plans

include both exclusive provider plans

such as health maintenance 

organizations (HMOs) and preferred

provider plans such as preferred

provider organizations (PPOs) and

point-of-service (POS) plans.

• In 10 States, managed care plans

were available in more than 9 out of

10 establishments. Establishments

in Tennessee (94.5%), California

(93.5%), Massachusetts (92.2%),

and the District of Columbia

(90.9%) all offered managed care

plans at rates significantly above the

national average.

• Less than half of the establishments

that offered health insurance in

Wyoming (45.5%) and Alaska

(48.9%) included a managed care

plan. Other States where managed

care plans were offered less

frequently than nationwide include

Idaho (57.6%), West Virginia

(64.6%), Maine (68.6%), Iowa

(75.3%), Michigan (77.2%), and

Pennsylvania (79.2%).

Agency for Healthcare Research and Quality

24

Medical Expenditure Panel Survey

Where are establishments most likely to

offer managed care plans?

Percent that have at least one managed care plan among establishments

offering health insurance, 1998

National average = 86.4%

At or above national average, 86.4%-94.5%

Below national average, 45.5%-86.3%

Significantly different from national average

Data not available

★

District of Columbia

★

★

★

★

★

★ ★

★

★

★

★

★

Estimates for Alaska, the District of Columbia, Hawaii,

Maine, Mississippi, Nevada, and Rhode Island are based

on 1997 survey data. See Note 1 for details.
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Exclusive provider plans (for

example, HMOs) require that enrollees

go to providers associated with the

plan except in an emergency. There is

typically no cost or a small fixed cost

for each physician visit.

• The States where employers were

most likely to offer an exclusive

provider plan were Massachusetts

(62.8%), California (60.5%), New

Hampshire (58.7%), Oregon

(56.5%), New York (51.9%),

Hawaii (51.1%), and Arizona

(48.6%).

• In general, exclusive provider plans

were most commonly offered in

the Northeast and on the West

coast.

• Exclusive provider plans were

much less common in the South

and Midwest.

Agency for Healthcare Research and Quality

25

Medical Expenditure Panel Survey

Where are establishments most likely to

offer exclusive provider plans?

Percent that have at least one exclusive provider plan among establishments offering

health insurance, 1998

National average = 38.6%

At or above national average, 38.6%-62.8%

Below national average, 8.3%-38.5%

Significantly different from national average

Data not available

★

District of Columbia

★

★

★

★

★

★

★

★ ★

★

★

★

★

★

★

★

★

★

★

★

★

★

★

★

Estimates for Alaska, the District of Columbia, Hawaii,

Maine, Mississippi, Nevada, and Rhode Island are based

on 1997 survey data. See Note 1 for details.
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In preferred provider plans (for

example, PPOs), enrollees can go to a

network of “preferred” providers

associated with the plan or to other

providers of their choice. If they choose

a non-preferred provider, they face

higher out-of-pocket costs.

• Preferred provider plans were most

frequently offered by employers in

the South and Midwest. In nine

States, more than 70% of the

establishments that offered health

insurance included a preferred

provider type plan.

• In New Hampshire (35.5%),

Massachusetts (42.5%), Rhode

Island (48.2%), Oregon (48.7%),

New York (50.1%), and California

(54.3%), the prevalence of preferred

provider plans was below the

national average. Note that these

States were above average when it

came to offering exclusive provider

plans. 

• Wyoming (38.9%), Idaho (46.1%),

Alaska (46.4%), and West Virginia

(51.6%) were below the national

average in offering both preferred

provider and exclusive provider

plans.

Agency for Healthcare Research and Quality

26

Medical Expenditure Panel Survey

Where are establishments most likely to

offer preferred provider plans?

Percent that have at least one preferred provider plan among establishments offering

health insurance, 1998

National average = 60.9%

At or above national average, 60.9%-78.6%

Below national average, 35.5%-60.8%

Significantly different from national average

Data not available

★

District of Columbia

★

★

★

★

★

★

★

★ ★

★

★

★

★

★

★

★

★

★

★

★

★ Rhode Island

Estimates for Alaska, the District of Columbia, Hawaii,

Maine, Mississippi, Nevada, and Rhode Island are based

on 1997 survey data. See Note 1 for details.
Future MEPS

Data on JobRelated

Health

Insurance

MEPS data on job-related health

insurance for 1996, 1997, 1998, and

1999 are currently available on the

MEPS Web site.

The Insurance Component of

MEPS is conducted annually. As

additional years of data become

available, trends such as the effects of

Federal and State regulations on

employer-sponsored health insurance

can be studied in greater detail.

Medical Expenditure Panel Survey Agency for Healthcare Research and Quality

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looking ahead

27
Medical Expenditure Panel Survey

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Agency for Healthcare Research and Quality

28

All the data shown in this chartbook

(and much more) are available on the

MEPS Web site at

http://www.meps.ahrq.gov/

data_pub/ic_toc.htm

The tables of data on the Web site are

also available for free on CD-ROM

(AHRQ No. 01-DP04). In addition to the

tables, the Web site provides an interactive

tool called MEPSnet that allows users to

make queries about trends in health

insurance offered by private establishments

and State and local governments across all

available years. The confidential microdata

are accessible for research purposes

through the Census Bureau’s Center for

Economic Studies. For additional

information, see their Web site at

http://www.ces.census.gov

The following references were used

for the descriptions and discussion in this

report.

Branscome JM, Cooper PF, Sommers JP,

et al. Private employer-sponsored health

insurance: new estimates by State.

Health Affairs 2000 Jan-Feb;19(1):

139-47.

Cohen JW, Monheit AC, Beauregard KM,

et al. The Medical Expenditure Panel

Survey: a national health information

resource. Inquiry 1996-97;33:373-89.

Cooper PF, Schone BS. More offers, fewer

takers for employment-based health

insurance: 1987 and 1996. Health

Affairs 1997 Nov-Dec;16(6):142-9.

Peterson CL, Vistnes JP. State differences

in job-related health insurance, 1996.

Rockville (MD): Agency for Healthcare

Research and Quality; 2000. MEPS

Chartbook No. 4. AHRQ Pub. No.

00-0017.

Sommers JP. List sample design of the

1996 Medical Expenditure Panel Survey

Insurance Component. Rockville (MD):

Agency for Health Care Policy and

Research; 1999. MEPS Methodology

Report No. 6. AHCPR Pub. No.

99-0037.

Sommers JP. Construction of weights for

the 1996 Medical Expenditure Panel

Survey Insurance Component list

sample. Rockville (MD): Agency for

Health Care Policy and Research; 1999.

MEPS Methodology Report No. 8.

AHCPR Pub. No. 00-0005.

Sommers JP. Imputation of employer

information for the 1996 Medical

Expenditure Panel Survey Insurance

Component. Rockville (MD): Agency

for Healthcare Research and Quality;

2000. MEPS Methodology Report No.

10. AHRQ Pub. No. 00-0039.

State of Hawaii Department of Labor and

Industrial Relations. Digest of Chapters

386, 392, and 393: Hawaii Workers’

Compensation, Temporary Disability

Insurance and Prepaid Health Care

Laws. Form DC-1, revised Oct 1992.

Vistnes JP, Monheit AC. Health insurance

status of the civilian noninstitutionalized

population: 1996. Rockville (MD):

Agency for Health Care Policy and

Research; 1997. MEPS Research

Findings No. 1. AHCPR Pub. No.

97-0030.

references
Medical Expenditure Panel Survey Agency for Healthcare Research and Quality

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Note 1: State-level estimates for 1997 were used in

this chartbook for seven States. State-level estimates

for 11 States were not available for 1998 because of

cost constraints. However, 1997 data were available

for seven of these States—Alaska, District of

Columbia, Hawaii, Maine, Mississippi, Nevada, and

Rhode Island—and these data have been included in

the report. For analytical consistency, all 1997

estimates were compared to the national totals for

1997. Currently, no data are available for the four

remaining States—Montana, North Dakota, South

Dakota, and Vermont.

Note 2: Private employers in Hawaii are not

required to offer health insurance to the following

workers: Federal, State, and county workers; workers

employed for less than 20 hours a week; agricultural

seasonal workers; insurance and real estate salesmen

paid solely by commission; individuals working for a

son, daughter, or spouse; children under the age of 21

working for father or mother; workers covered as

dependents under a qualified health care plan;

workers covered by State-governed medical

assistance; or workers receiving public assistance. To

be covered under the mandate, workers must have

worked four consecutive weeks of 20 or more hours

a week and earned monthly wages of at least 86.67

times the Hawaii minimum hourly wage, which is

currently $5.25. Employers are required to pay at

least half of the premium cost (State of Hawaii

Department of Labor and Industrial Relations, 1992).

Estimates shown here for Hawaii are based on 1997

data.

Note 3: When conducting several tests

simultaneously on the same data set, it is important

to control the overall significance level of the tests.

Failure to do so can lead to an increased number of

tests with “false significance” results. Multiple

comparison procedures are used to address this

problem. For this chartbook, a multiple-comparison

procedure using the Bonferroni inequality was used

when simultaneously testing whether each of the

States differs from the national average.

Note 4: The first MEPS IC data were obtained in

1996, prior to the implementation of the Health

Insurance Portability and Accountability Act (HIPAA).

The 1998 data presented in this chartbook were

collected after HIPAA implementation. HIPAA

requires that insurers not deny coverage to a worker

on the basis of health status. Employers may refuse

to cover a pre-existing condition for up to 12 months

for new employees, but employees can reduce the

length of that waiting period by the length of prior

coverage.

notes
Order your free CD-ROM:

MEPS IC-002: 1996/1997/1998 Employer-Sponsored Health Insurance Data

AHRQ No. 01-DP04

Write:

AHRQ Publications Clearinghouse

Attn: 01-DP04

P.O. Box 8547

Silver Spring, MD 20907

Or call:

1-800-358-9295 and ask for AHRQ 01-DP04.

For these and other data, visit the MEPS Web site at:

http://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 evidencebased 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.
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Agency for Healthcare Research and Quality

32

Medical Expenditure Panel Survey
www.ahrq.gov

AHRQ Publication No. 01-0036

September 2001

ISBN 1-58763-052-4

ISSN 1531-5649

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