Medical Expenditure Panel Survey Agency for Healthcare 

Research and Quality

STATISTICAL BRIEF #127 

June 2006 

Changes in Co-pays for EmployerSponsored Health Insurance Plans, 

1999–2003 

Highlights 

 While the majority of 

enrolled employees (57.0 

percent) had a physician copay of more than $0 but less

than or equal to $10 in 1999,

by 2003 most employees 

(60.8 percent) paid more 

than $10 but less than or 

equal to $20 for a physician 

visit. 

 While employees of small 

and large firms with insurance posted an increase in 

those covered by physician 

co-pays of more than $20 

over the 1999–2003 period, 

the jump was much greater 

for small firms (from 3.0 

percent to 19.2 percent) than 

for large firms (1.3 percent to 

8.9 percent). 

 Compared with other 

hospital co-pay amounts, 

only zero dollar hospital copays showed a drop in the 

percentage of enrollees 

paying that amount—from 

66.3 percent in 1999 to 45.3 

percent in 2003. 

Beth Levin Crimmel, MS, Amy K. Taylor, PhD, Alice M. Zawacki, PhD

Introduction 

The use of co-pays for physician services and in-patient hospital 

services is one way employers share the cost of the health insurance 

coverage that they provide to their enrolled employees. This 

Statistical Brief discusses changes in co-pay amounts for employersponsored health insurance from 1999 to 2003. 

The estimates shown in this brief, which are drawn from the 

Insurance Component of the Medical Expenditure Panel Survey 

(MEPS-IC), pertain to employees of firms in the private sector of the 

economy who are enrolled in an employer-sponsored plan. Data for 

employees working for small (fewer than 50 employees) and large 

firms (50 or more employees) are analyzed. All differences between 

estimates discussed in the text are statistically significant at the 0.05 

level. 

Findings

Physician co-pays 

For purposes of this analysis, the amount of an enrollee’s co-pay for 

a visit to a physician required by a health insurance plan was 

categorized as follows: 

– Co-pay of $0 (zero)

– Co-pay of more than $0 but less than or equal to $10 (low) 

– Co-pay of more than $10 but less than or equal to $20 (medium) 

– Co-pay of more than $20 (high) 

The percentage of employees enrolled in a plan with no or a low physician co-pay dropped dramatically 

from 1999 to 2003 (figure 1). Conversely, the percentage of employees enrolled in plans with medium or

high co-pays rose substantially over the period. 

In 1999, most enrollees (57.0 percent) were in a plan with a low physician co-pay. By 2003, this 

percentage had fallen to 23.5 percent. This downward trend was consistent across all four years. Those 

with zero co-pays fell from 7.6 percent to 4.7 percent of all enrolled employees over the period.

In contrast to the low co-pay group, just one-third (33.4 percent) of enrollees had a medium co-pay in 

1999. After covering an increasing percentage of enrolled employees in each year, most employees (60.8

percent) had a medium physician co-pay by 2003. Those with high co-pays rose from a very small 

percentage of employees in 1999 (2.0 percent) to 11.0 percent in 2003. 
For both small and large employers, the percentage of enrolled employees with low co-pays fell sharply 

from 1999 to 2003 (figures 2 and 3). The decline was from 54.1 percent to 20.9 percent for employees of 

small firms and from 59.0 percent to 24.1 percent for employees of large firms The reverse was true for 

employees with medium co-pays; their percentages increased over the period from 34.5 percent to 52.6 

percent for small firms and from 32.7 percent to 62.8 percent for large firms. 

While both small and large firms posted an increase in employees in plans with high physician co-pays, 

the jump was much greater for small firms (from 3.0 percent to 19.2 percent) than for large firms (1.3 

percent to 8.9 percent). 

In-patient hospital co-pays 

For purposes of this analysis, the amount of an enrollee’s co-pay for an in-patient visit to a hospital 

required by a health insurance plan was categorized as follows: 

– Co-pay of $0 (zero) 

– Co-pay of more than $0 but less than or equal to $150 (low) 

– Co-pay of more than $150 but less than or equal to $400 (medium) 

– Co-pay of more than $400 (high) 

Only zero dollar hospital co-pays showed a drop in the percentage of enrollees paying that amount—from 

66.3 percent in 1999 to 45.3 percent in 2003 (figure 4). Low, medium, and high co-pays all covered more 

employees by the end of the period. In the case of both the medium and high co-pays, the percentage of 

enrolled employees covered doubled to 21.0 percent and 13.1 percent, respectively. For low co-pays, the 

percentage rose from 16.9 percent in 1999 to 20.6 percent in 2003. 

Employees of both small and large firms enrolled in a health insurance plan showed large declines over 

the period in the percentage covered by zero dollar hospital co-pay plans (figures 5 and 6).The change 

for employees of small firms was from 62.8 percent to 42.9 percent; the drop for employees of large firms 

was from 68.6 percent to 45.9 percent. 

For those co-pays that were more common by 2003 than in 1999, the increase in enrollees covered in 

small firms was most noticeable for the high co-pays, going from 8.1 percent in 1999 to 20.5 percent in 

2003. In large firms, the increase was most pronounced for medium hospital co-pays, rising from 10.2 

percent to 22.4 percent. 

Data Source 

This Statistical Brief summarizes data from the 1999 and 2003 MEPS-IC. The data are available on the 

MEPS Web site (www.meps.ahrq.gov) or have been produced using special computation runs on the 

confidential MEPS-IC data available at the U.S. Census Bureau. 

The analysis and results presented in this brief are attributable to the authors and do not necessarily 

reflect concurrence by the Center for Economic Studies, U.S. Census Bureau. This brief has undergone a 

more limited review by the Census Bureau than official Census publications. It has been screened to 

ensure that no confidential data are revealed. 

Definitions 

Employees who were covered by a plan that required them to pay only a coinsurance percentage and no 

fixed-dollar co-pay amount are excluded from this analysis. 

Co-pay 

A co-pay is a fixed-dollar amount that an enrollee pays when medical service is received, regardless of 

the total charge for the service. The co-pays in this analysis are not adjusted for inflation. 

Coinsurance 

Coinsurance is a fixed percentage that an enrollee pays for medical expenses after the deductible 

amount, if any, is paid. 
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. 

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. 

Health insurance plan 

An insurance contract that provides hospital and/or physician coverage to an employee for an agreedupon fee (premium) for a defined benefit period. 

About MEPS-IC 

MEPS-IC is a survey of business establishments and governments that collects information on employersponsored health insurance, such as whether insurance is offered, enrollments, types of plans, and 

premiums. The survey is conducted annually by the U.S. Census Bureau under the sponsorship of the 

Agency for Healthcare Research and Quality. The yearly response rate has averaged 78 percent for inscope sample units. Approximately 4 percent of the original sample has been out-of-scope in a typical 

year. A total sample of 48,000 establishments was selected for the 2003 survey, prior to accounting for 

losses due to nonresponse and out-of-scope cases. 

For more information on this survey, see MEPS Methodology Reports 6, 8, 10, and 14 and the MEPS-IC 

technical appendix, which can be found on the MEPS Web site (www.meps.ahrq.gov). 

Suggested Citation 

Crimmel, B. L., Taylor, A. K., and Zawacki, A. M. Changes in Co-pays for Employer-Sponsored Health 

Insurance Plans, 1999–2003. Statistical Brief #127. June 2006. Agency for Healthcare Research and 

Quality, Rockville, Md. http://meps.ahrq.gov/mepsweb/data_files/publications/st127/stat127.pdf 

∗ ∗ ∗

AHRQ welcomes questions and comments from readers of this publication who are interested in 

obtaining more information about access, cost, use, financing, and quality of health care in the United 

States. We also invite you to tell us how you are using this Statistical Brief and other MEPS data and 

tools and to share suggestions on how MEPS products might be enhanced to further meet your needs. 

Please e-mail us at mepspd@ahrq.gov or send a letter to the address below: 

Steven B. Cohen, PhD, Director 

Center for Financing, Access, and Cost Trends 

Agency for Healthcare Research and Quality 

540 Gaither Road 

Rockville, MD 20850 
Source: Center for Financing, Access, and Cost Trends, AHRQ, Insurance Component of the Medical Expenditure Panel Survey,

1999 and 2003

7.6 7.6 4.3 4.6 4.7

30.0

40.1

49.5

23.5

57.0

60.8

57.8

52.3

33.4 40.6

11.0 7.6

2.0 2.3 3.2

0%

25%

50%

75%

100%

1999 2000 2001 2002 2003

$0 Low: >$0<=$10 Medium: >$10<=$20 High: >$20

Percent

Figure 1. Percentage of enrolled employees with

selected physician co-pays, by year, all firms

Source: Center for Financing, Access, and Cost Trends, AHRQ, Insurance Component of the Medical Expenditure Panel Survey,

1999 and 2003

8.4 8.7 7.0 6.7 7.3

27.2

35.2

47.4

20.9

54.1

52.6

53.0

49.9

34.5 40.6

19.2 13.0 7.9

3.0 3.3

0%

25%

50%

75%

100%

1999 2000 2001 2002 2003

$0 Low: >$0<=$10 Medium: >$10<=$20 High: >$20

Percent

Figure 2. Percentage of enrolled employees with selected

physician co-pays, by year, firms with fewer than 50 employees
Source: Center for Financing, Access, and Cost Trends, AHRQ, Insurance Component of the Medical Expenditure Panel Survey,

1999 and 2003

7.0 6.9 3.6 4.1 4.1

30.7

41.4

51.0

24.1

59.0

62.8

58.9

52.9

32.7 40.6

6.3 8.9

1.3 1.5 2.1

0%

25%

50%

75%

100%

1999 2000 2001 2002 2003

$0 Low: >$0<=$10 Medium: >$10<=$20 High: >$20

Percent

Figure 3. Percentage of enrolled employees with selected

physician co-pays, by year, firms with 50 or more employees

Source: Center for Financing, Access, and Cost Trends, AHRQ, Insurance Component of the Medical Expenditure Panel Survey,

1999 and 2003

66.3 62.2 61.3

45.3 50.0

18.7

15.1 15.7

20.6

16.9

21.0 19.7

14.7 15.1 10.5

11.6 13.1 6.4 7.0 9.0

0%

25%

50%

75%

100%

1999 2000 2001 2002 2003

$0 Low: >$0<=$150 Medium: >$150<=$400 High: >$400

Percent

Figure 4. Percentage of enrolled employees with

selected hospital co-pays, by year, all firms
Source: Center for Financing, Access, and Cost Trends, AHRQ, Insurance Component of the Medical Expenditure Panel Survey,

1999 and 2003

62.8 62.1

52.2

46.2 42.9

21.8

18.4

16.6

21.6

18.3 15.0 13.5 13.5

10.8 12.4

18.5 20.5 15.8 8.1 8.9

0%

25%

50%

75%

100%

1999 2000 2001 2002 2003

$0 Low: >$0<=$150 Medium: >$150<=$400 High: >$400

Percent

Figure 5. Percentage of enrolled employees with selected

hospital co-pays, by year, firms with fewer than 50 employees

Source: Center for Financing, Access, and Cost Trends, AHRQ, Insurance Component of the Medical Expenditure Panel Survey,

1999 and 2003

68.6 62.2 63.3

45.9 51.0

17.9

14.3

15.1

20.4

15.9 22.4 21.2

16.9 14.9 10.2

7.4 9.9 11.3 5.3 5.8

0%

25%

50%

75%

100%

1999 2000 2001 2002 2003

$0 Low: >$0<=$150 Medium: >$150<=$400 High: >$400

Percent

Figure 6. Percentage of enrolled employees with selected

hospital co-pays, by year, firms with 50 or more employees