Small and large firms vary substantially on health insurance offer
rates and costs. Small firms are less likely to offer coverage, and
there are important differences in the health benefits that small and
larger firms offer. Workers at small firms are responsible for paying
both a larger share of family premiums as well as higher cost sharing
than workers in large firms. This Snapshot expands on information
presented in the 2012 Kaiser/HRET Survey of Employer-Sponsored Health
Benefits to look exclusively at differences in offer rates, plan costs,
and cost sharing between small firms and large firms.
We define “small firms” as employers with three to 199 workers and
“large firms” as employers with 200 or more workers. While the vast
majority of businesses in the United States are small businesses, the
majority of workers are employed at large firms. Of the over three
million firms with three or more workers, 98% have between three and 199
employees. Small firms employ 39% of all workers and 33% of workers
who receive health insurance through their own job.[1] Information on the Survey’s methodology can be found in the 2012 Kaiser/HRET Employer Health Benefits Survey full report.[2]
Health Insurance Offer and Coverage Rates
Small firms are much less likely to offer health insurance than
large firms. Of firms with 3 to 199 employees, 61% offer health
insurance, a stark contrast to the 98% of firms with 200 or more
employees that offer coverage to at least some of their employees.
Very small firms (3-9 workers) are least likely to offer health
insurance to employees, with only 50% of these firms offering coverage
in 2012. Since most firms in the country are small, the overall offer
rate is determined primarily by the percentage of the smallest firms
(3-9 workers) offering health benefits. Small firms may not offer
coverage for a variety of reasons, including the inability to afford
premiums, employees may be covered elsewhere, or the firm may feel that
the benefit does not impact their ability to recruit and retain
qualified employees.[3] In 2012, 48% of small firms
not offering coverage indicated that the cost of health insurance was
the primary reason that they did not offer coverage. [4]
For the full article and alot of charts and graphs, go to http://www.kff.org/insurance/snapshot/chcm121112oth.cfm