Small Firms Not Causing Health Benefits Drop: EBRI

But Fronstins analysis of figures from the U.S. Census Bureau shows that the percentage of U.S. workers who work for small firms was about the same in 2002 as it was in 1987. The analysis also shows that workers at the biggest companies were more likely to lose employer-sponsored health benefits than workers at smaller firms.

Fronstin points out that the population of small firms changes rapidly. Some small firms grow their way out of the small firm category, but others die or agree to acquisitions by other firms.

Because so few small firms stay in the small firm category, the percentage of U.S. workers employed by firms with fewer than 500 employees fell to 56% in 2002, from 58% in 1987.

About 15% of U.S. workers worked for firms with fewer than 25 employees in 2002, and that figure is about the same as it was in 1987, according to Fronstins analysis.

Over the same 15-year period, the percentage of workers at firms with fewer than 25 employees who got health coverage from their employers actually increased to 31%, from 30%.

The percentage of workers who got health coverage from their employers fell to 54%, from 57%, for firms with 25 to 99 employees; to 65%, from 69%, for firms with 100 to 499 employees; and to 69%, from 76%, for firms with more than 500 employees.

Reproduced from National Underwriter Life & Health/Financial Services Edition, September 3, 2004. Copyright 2004 by The National Underwriter Company in the serial publication. All rights reserved.Copyright in this article as an independent work may be held by the author.