Job Based Health Care Drying Up, Study Reports

By Cindy Peng
Daily Cal Staff Writer
Monday, June 6, 2005

As this year’s California graduates look to land their first full-time jobs, a UC Berkeley study predicted Thursday that they will find it harder than ever to get health care from their employers over the next five years.

The study, released by UC Berkeley’s Center For Labor Research and Education and Working Partnerships USA, a nonprofit labor advocacy group, predicts that more than one million additional adults in California will go without job-based health care by 2010.

The percentage of adult Californians without employer-provided insurance would rise from 42 to 47 percent if health care premiums continue to rise at least 10 percent annually, the study said.

“We’re really seeing job-based coverage disappearing for half the population,” said Ken Jacobs, deputy chair of the center and the study’s co-author.

According to the study, health care premiums paid by employers for California families have increased from an average of about $6,000 in 2000 to about $8,000 in 2003.

Individual premiums during the same period increased from about $2,000 to about $3,000.

Employers often responded to the increase by passing some of the cost onto workers or being more restrictive about who qualified for health care, the study said.

College graduates may find themselves paying more for health care that is harder to qualify for as employers increase restrictions, researchers and consumer advocates said.

Recent graduates joining the work force may face higher out-of-pocket costs for their health care, Jacobs said.

“For college graduates entering the job market, it means they’re much less likely to enter a job where they’re offered affordable health care,” Jacobs said. “The offer is going to be there, but the cost is going to be higher.”

Workers who are part of a new wave of lower-paying jobs in the state will be hit hardest, Jacobs said.

“Where we see the greatest growth in jobs today is in the job sector where people are being paid $9 to $11 an hour,” Jacobs said. “This is precisely the job category where health insurance is disappearing the fastest.”

The percentage of full-time workers earning between $9 and $11 an hour covered by employer-funded health insurance dropped 13 percent from in the last four years, the study said.

Both researchers and lobbyists said new legislative policies to ensure employee health coverage are a possible solution to California’s health care woes.

Californians voted down a measure last November that would have required many employers to provide health care, but Jacobs said the closeness of the vote showed the public is concerned about health care accessibility.

“I think that gives some sense that the public recognizes the problem,” Jacobs said.

Anthony Wright, executive director of Oakland-based Health Access California, a health care consumer advocacy group, said the results of the study will help convey the urgent need for health care reform.

“The study is a wake-up call that we need legislative action quickly,” Wright said. “Health coverage in a job will no longer be expected, and people will be on their own if we don’t have some policy action.”