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STATISTICAL BRIEF #329:
State Differences in the Cost of Job-Related Health Insurance, 2010

July 2011

James M. Branscome, MS

Highlights

Among all U.S. employees enrolled in job-related health insurance in 2010, 51.3 percent took single coverage, 18.3 percent took employee-plus-one coverage, and 30.3 percent took family coverage.
Looking at the 10 largest states, the percentage of employees opting for single coverage ranged from 42.9 percent in Michigan to 58.2 percent in North Carolina, for employee-plus-one coverage from 16.5 percent in New York to 20.9 percent in Michigan, and for family coverage from 22.3 percent in North Carolina to 36.2 percent in Michigan.
Nationwide, the average premiums were $4,940 for single coverage, $9,664 for employee-plus-one coverage, and $13,871 for family coverage. Among the 10 largest states, single premiums ranged from $4,669 in Ohio to $5,220 in New York, employee-plus-one premiums ranged from $8,947 in Georgia to $10,642 in New York, and family premiums ranged from $13,083 in Ohio to $15,032 in Florida.

Introduction

Health insurance provided by employers is the primary source of medical coverage for most Americans under age 65. The cost of employer-sponsored health insurance coverage varies considerably depending upon where one lives and on the number of persons covered by the plan.

This Statistical Brief presents state variations from the national average of the cost of job-related health insurance and how these costs are shared by employers and their employees. The Brief specifically examines the average premiums and employee contributions for private sector establishments in 2010 in the 10 most populous states based on the 2010 Decennial Census, using the most recent data available from the Insurance Component of the Medical Expenditure Panel Survey (MEPS-IC). Estimates for all other states and the District of Columbia are available on the MEPS Web site (www.meps.ahrq.gov).

Only those estimates with statistically significant differences from the national average using a multiple comparison procedure of estimates from all 50 states and the District of Columbia at the 0.05 percent significance level are noted in the text. These estimates are also identified in the tables, with those above the national average noted with two asterisks (**) and those below the national average noted with one asterisk (*).

Findings

The percentage of employees enrolled in single, employee-plus-one, or family coverage can vary by state based on such factors as the number of one- and two-person households in the state, the number of multiple-worker families in which each person takes single coverage from his or her employer, the prevalence of unions, and the additional cost to an employee to insure his or her family beyond the cost for single coverage.

From table 1:

In the United States, employees enrolled in health insurance coverage through their employer were more likely to take single, self-only coverage (51.3 percent) than they were to take non-single coverage (48.7 percent). Non-single coverage is a plan that covers the employee and at least one other person.
The percentage of employees enrolled in single coverage in North Carolina (58.2 percent) was higher than the national average of 51.3 percent.
Michigan (42.9 percent) and Ohio (47.8 percent) were lower than the national average.
The percentage of employees enrolled in employee-plus-one coverage was higher than the national average of 18.3 percent in Michigan (20.9 percent).
The percentage of employees enrolling in family coverage was higher than the national average of 30.3 percent in Michigan (36.2 percent), Ohio (34.1 percent), and New York (32.9 percent) while lower in North Carolina (22.3 percent), Texas (27.4 percent), and Florida (27.6 percent).

Job-related health insurance premiums can vary for many reasons, such as the type of health insurance plan offered, the generosity of the plan, the size of the firm offering the plan, various workforce characteristics, state health insurance regulations, and the local cost of health care. All of these factors can contribute to differences in the average health insurance premiums between states.

From table 2:

The average annual health insurance premiums in the United States in 2010 were $4,940 for single coverage, $9,664 for employee-plus-one coverage, and $13,871 for family coverage.
The average state health insurance premiums for single coverage were above the national average in New York ($5,220) and below the national average in Ohio ($4,669).
The average state health insurance premiums for employee-plus-one coverage were above the national average in New York ($10,642).
The average state health insurance premiums for family coverage were above the national average in Florida ($15,032), New York ($14,730), Illinois ($14,703), and Texas ($14,526) and were below the national average in Ohio ($13,083) and Georgia ($13,114).

Health insurance premiums can be paid totally by the employer or the employee, or the cost can be shared by both parties. While cost sharing between employers and employees is the most common arrangement, a significant number of employees pay no contribution toward their health insurance premium.

From table 3:

Nationwide, 18.3 percent of employees with single coverage, 9.8 percent with employee-plus-one coverage, and 10.4 percent with family coverage made no contribution toward their premiums.
Employees in California (24.5 percent) were more likely to make no contribution toward single-coverage premiums than the national average of 18.3 percent, while employees were less likely to make no contribution in Illinois (11.9 percent).
Employees in Texas (3.9 percent) and Florida (4.2 percent) were less likely to make no contribution to employee-plus-one coverage premiums than the national average of 9.8 percent.
Employees in Florida (2.6 percent) and Texas (4.2 percent) were also less likely to make no contribution toward family coverage premiums than the national average of 10.4 percent.

The average employee contributions to health insurance premiums (including the zero contributions noted in table 3) can vary significantly between states. In table 4, the average employee contributions for single, employee-plus-one, and family coverage per enrolled employee are displayed for the 10 largest states—both in dollar amounts and as a percentage of the average premium in each state.

From table 4:

The average annual employee contributions to health insurance premiums per enrolled employee in the United States in 2010 were $1,021 for single coverage (20.7 percent of the average single premium), $2,498 for employee-plus-one coverage (25.8 percent of the average employee-plus-one premium), and $3,721 for family coverage (26.8 percent of the average family premium).
Employee contributions for employee-plus-one coverage in Michigan ($2,012) were lower than the national average of $2,498. As a percentage of the average employee-plus-one premium, Pennsylvania (20.2 percent) employees also contributed less than the national average.
Employees in Florida ($4,685) and Texas ($4,500) contributed more than the national average of $3,721 toward their family coverage health insurance premiums. Employees in Texas also contributed more as a percentage of the premium (31.0 percent) than the national average of 26.8 percent. Employees in Michigan ($2,879 or 21.9 percent of the premium) and Pennsylvania ($3,013 or 22.2 percent of the premium) contributed less than the national average toward their family coverage health insurance premiums.

Data Source

The statistics in this Brief are estimates from the 2010 MEPS-IC. All information comes from tables that are available on the MEPS Web site (www.meps.ahrq.gov). Estimates for other states and other years are also available on the MEPS Web site, although estimates are not available for every state in every year.

Definitions

Employer
A particular workplace or physical location where business is conducted or services or industrial operations are performed. In this Brief, only private sector employer estimates are reported.

Employee
A person on the actual payroll. This excludes temporary and contract workers but includes the owner or manager if that person works at the firm.

Enrollee
An employee who is enrolled in a health insurance plan offered by the employer. Enrollees do not include any dependents covered by the plan.

Health insurance plan
An insurance contract that provides hospital and/or physician coverage to an employee for an agreed-upon fee for a defined benefit period, usually a year. This includes both fully insured and self-insured health insurance plans.

Premium
Agreed-upon fees paid for coverage of medical benefits for a defined benefit period. Premiums can be paid by employers, unions, employees, or shared by the insured individual and the plan sponsor.

Percentage of the average premium contributed by enrollees
The average employee contribution at the state level divided by the average health insurance premium at the state level.

Single coverage
Health insurance that covers the employee only.

Employee-plus-one coverage
Health insurance that covers the employee plus one family member at a lower premium level than family coverage. This family member could be a spouse or a child. If premiums differed for employee-plus-spouse and employee-plus-child coverage, information for employee-plus-child coverage was reported.

Family coverage
Health insurance that covers the employee and the employee’s family. If a plan offers more than one pricing level for family coverage, information for a family of four was reported.

About MEPS-IC

The MEPS-IC is a survey of business establishments and governments that collects information on employer-sponsored health insurance, such as whether insurance is offered, enrollments, types of plans, and premiums. The survey is conducted annually by the U.S. Census Bureau under the sponsorship of the Agency for Healthcare Research and Quality (AHRQ). A total sample of approximately 42,000 private-sector establishments was selected for the 2010 survey; with 8.3 percent of the sample determined to be out-of-scope during the data collection process. The response rate for the private-sector was 82.7 percent of the remaining in-scope sample units.

For more information on this survey, see MEPS Methodology Reports 6, 8, 10, 14, 17, and 18 and the MEPS-IC Technical Notes and Survey Documentation, which are available on the MEPS Web site (www.meps.ahrq.gov).

Suggested Citation

Branscome, J.M. State Differences in the Cost of Job-Related Health Insurance, 2010. Statistical Brief #329. July 2011. Agency for Healthcare Research and Quality, Rockville, MD. http://www.meps.ahrq.gov/mepsweb/data_files/publications/st329/stat329.shtml

* * *
AHRQ welcomes questions and comments from readers of this publication who are interested in obtaining more information about access, cost, use, financing, and quality of health care in the United States. We also invite you to tell us how you are using this Statistical Brief and other MEPS data and tools and to share suggestions on how MEPS products might be enhanced to further meet your needs. Please e-mail us at MEPSProjectDirector@ahrq.gov or send a letter to the address below:

Steven B. Cohen, PhD, Director
Center for Financing, Access, and Cost Trends
Agency for Healthcare Research and Quality
540 Gaither Road
Rockville, MD 20850

State	Single coverage	Employee-plus-one coverage	Family
Table 1. Percentage of private sector employees enrolled in employer-based health insurance plans that have single, employee-plus-one, or family coverage: United States and 10 largest states, 2010
United States	51.3%	18.3%	30.3%
California	52.6%	18.7%	28.7%
Texas	53.3%	19.3%	27.4%*
New York	50.6%	16.5%	32.9%**
Florida	53.7%	18.7%	27.6%*
Illinois	50.1%	18.7%	31.2%
Pennsylvania	50.9%	19.3%	29.8%
Ohio	47.8%*	18.1%	34.1%**
Michigan	42.9%*	20.9%**	36.2%**
Georgia	53.3%	17.3%	29.3%
North Carolina	58.2%**	19.5%	22.3%*
* Below the national average. ** Above the national average. Note: Percentages may not add to 100 percent due to rounding. Source: Center for Financing, Access, and Cost Trends, AHRQ, Insurance Component of the Medical Expenditure Panel Survey, 2010, Tables II.C.4, II.D.4, and II.E.4

State	Single coverage	Employee-plus-one coverage	Family coverage
Table 2. Average annual health insurance premium per enrolled employee at private sector establishments offering health insurance: United States and 10 largest states, 2010
United States	$4,940	$9,664	$13,871
California	$4,811	$9,559	$13,819
Texas	$4,951	$10,018	$14,526**
New York	$5,220**	$10,642**	$14,730**
Florida	$5,120	$9,718	$15,032**
Illinois	$5,067	$9,980	$14,703**
Pennsylvania	$4,959	$10,018	$13,550
Ohio	$4,669*	$9,268	$13,083*
Michigan	$4,713	$9,833	$13,148
Georgia	$4,786	$8,947	$13,114*
North Carolina	$4,980	$8,980	$13,643
* Below the national average. ** Above the national average. Source: Center for Financing, Access, and Cost Trends, AHRQ, Insurance Component of the Medical Expenditure Panel Survey, 2010, Tables II.C.1, II.D.1, and II.E.1

State	Single coverage	Employee-plus-one coverage	Family coverage
Table 3. Percentage of private sector employees enrolled in single, employee-plus-one, and family health insurance coverage that required no contribution from the employee: United States and 10 largest states, 2010
United States	18.3%	9.8%	10.4%
California	24.5%**	14.5%	14.4%
Texas	20.3%	3.9%*	4.2%*
New York	17.8%	12.1%	11.9%
Florida	15.4%	4.2%*	2.6%*
Illinois	11.9%*	12.5%	10.1%
Pennsylvania	19.6%	16.9%	17.5%
Ohio	15.0%	9.6%	12.5%
Michigan	18.1%	12.8%	10.8%
Georgia	14.8%	8.9%	9.0%
North Carolina	17.3%	7.0%	6.7%
* Below the national average. ** Above the national average. Source: Center for Financing, Access, and Cost Trends, AHRQ, Insurance Component of the Medical Expenditure Panel Survey, 2010, Tables II.C.4.a, II.D.4.a, and II.E.4.a

State	Single coverage, dollars	Single coverage, percentage of premium	Employee-plus-one coverage, dollars	Employee-plus-one coverage, percentage of premium	Family coverage, dollars	Family coverage, percentage of premium
Table 4. Average annual employee contribution toward the premium per enrolled employee at private sector establishments offering health insurance: United States and 10 largest states, 2010
United States	$1,021	20.7%	$2,498	25.8%	$3,721	26.8%
California	$1,048	21.8%	$2,452	25.7%	$3,845	27.8%
Texas	$1,036	20.9%	$2,966	29.6%	$4,500**	31.0%**
New York	$1,086	20.8%	$2,496	23.5%	$3,630	24.6%
Florida	$1,073	21.0%	$3,049	31.4%	$4,685**	31.2%
Illinois	$1,120	22.1%	$2,629	26.3%	$3,928	26.7%
Pennsylvania	$954	19.2%	$2,023	20.2%*	$3,013*	22.2%*
Ohio	$952	20.4%	$2,298	24.8%	$3,286	25.1%
Michigan	$951	20.2%	$2,012*	20.5%	$2,879*	21.9%*
Georgia	$965	20.2%	$2,408	26.9%	$3,702	28.2%
North Carolina	$926	18.6%	$2,166	24.1%	$3,492	25.6%
* Below the national average. ** Above the national average. Source: Center for Financing, Access, and Cost Trends, AHRQ, Insurance Component of the Medical Expenditure Panel Survey, 2010, Tables II.C.2, II.C.3, II.D.2, II.D.3, II.E.2, and II.E.3

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STATISTICAL BRIEF #329: State Differences in the Cost of Job-Related Health Insurance, 2010