As many as 7.7 million workers lost jobs with employer-sponsored insurance (ESI) during the Covid-19 shutdown, but not all remain uninsured, according to a new study from the Employee Benefit Research Institute (EBRI).
Since 6.9 million dependents were covered by these workers' insurance, a total of 14.6 million people have been affected, according to the study, "How Many Americans Have Lost Jobs with Employer Health Coverage During the Pandemic?” The study was conducted jointly by EBRI, The W.E. Upjohn Institute for Employment Research and the Commonwealth Fund and is available here: (https://www.ebri.org/docs/default-source/ebri-issue-brief/ebri_ib_esicovidloss-8oct20.pdf?sfvrsn=f0763a2f_6),
The findings “illustrates how the country’s predominantly job-based health insurance system leaves workers and their families at risk of losing coverage during a severe economic downturn,” Sara Collins, Commonwealth Fund vice president for health care coverage, said.
While seemingly dire, those numbers don’t tell the whole story of employee health insurance coverage. During the last three quarters of 2020, on average only about a third of those who lost employee-sponsored insurance (ESI) coverage through pandemic-related job loss will become uninsured, according to estimates from The Urban Institute. About a third will obtain coverage through another family member’s ESI, just over a quarter will become covered by Medicaid or the Children’s Health Insurance Program (CHIP) and a small percentage will obtain nongroup insurance, the institute said.
This implies that, even for those who lose ESI following the loss of a job with ESI, only a minority will lose health coverage, the study found.
“Only with time will we know how many job losses are ultimately permanent and result in loss of ESI,” said Stephen A. Woodbury, Upjohn Institute senior economist. “In the interim, it will be important to monitor key labor market statistics, including the number of workers on furlough or temporary layoff who become permanent job losers, and the number of job losers who have been unemployed for 15 weeks or more and are unlikely to be attached to an employer and covered by ESI.”
In fact, according to EBRI, whether an individual and his or her dependents remain insured or obtain coverage depends on three factors:
• Is the job loss temporary or permanent, and if temporary, does the employer continue ESI coverage until the worker is called back to work?
• To what extent will temporary layoffs without loss of ESI become permanent layoffs with loss of ESI?
• When workers do lose ESI, how many will obtain coverage through other family members, COBRA, the ACA marketplace or Medicaid?
A notable, if not surprising finding from the EBRI study is that job loss with ESI has been uneven. Lockdowns have impacted some industries and groups of workers more severely than others. Total job losses in manufacturing accounted for 10% of pre-pandemic employment and 12% of unemployed workers in June. But because manufacturing has one of the highest rates of ESI coverage at 66%, it accounted for a greater proportion of loss of jobs with ESI—19% of potential ESI coverage loss when dependents are included.
By contrast, nearly 3.3 million workers in accommodations and food services became unemployed between February and June—30% of the industry’s workforce. However, only 25% of workers in that industry had ESI pre-pandemic, so only 7% lost jobs with ESI as a result of shutdowns.