Employer-Sponsored Health Coverage Continues its Slide in New Jersey

Long before “Obamacare” entered our lexicon, American (and New Jersey) employers began shedding health insurance for their employees. The Great Recession accelerated the trend. And, the fastest-expanding job sector (services) is the sector least likely to provide its workers with health insurance.

Over 1 in 3 New Jerseyans under 65 do not receive health insurance coverage from their employers, a large jump from a decade ago, when 1 in 4 Garden State residents lacked this type of coverage.

The decrease in employer-sponsored health insurance coverage in 2010/2011 is largely the result of many businesses feeling the squeeze on both sides: while the Great Recession and its laggard recovery in New Jersey have given businesses a little less money to spread around, insurance premiums continue to rise, forcing many businesses to stop offering this once-common benefit. In addition, large numbers of New Jerseyans remain completely out of work and, obviously, don’t have employer-sponsored coverage.

From 2000/2001 to 2010/2011, the share of New Jerseyans with employer-sponsored insurance decreased by 11.8 percentage points, from 76.9 percent to 65.1 percent. That’s a larger proportional decrease than the nation as a whole, which saw a decrease of 10 percentage points. The actual number of New Jerseyans with this type of coverage decreased over the same time period from 5.6 million people to 4.9 million. In other words, 684,099 fewer residents have health insurance coverage from their employers than did just a decade ago.

The news is a little worse for New Jersey’s children. Sixty-four percent of New Jerseyans under 18 do not have employer-sponsored insurance (most often from a parent or guardian), a decrease of 13.5 percentage points from a decade ago.

The new data, released today by NJPP’s national partners at the Economic Policy Institute, clearly shows that the system of employer-based insurance is failing many New Jersey families. Luckily, public insurance programs like Medicaid and New Jersey FamilyCare are covering the most vulnerable, including hundreds of thousands of poor children. But many New Jerseyans – particularly those of working age who earn wages above official poverty levels but below those needed to get by – are falling through the cracks and simply going without health insurance.

Luckily, help is on the way, but New Jersey has to do its part. Federal health care reform – particularly if New Jersey designs its own high-quality, well-run health insurance exchange and expands Medicaid benefits – will ensure that more working New Jerseyans can afford health insurance and no longer have to rely on squeezed or unwilling employers.

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