Employer Provided Health Insurance – Recent Statistics

The Kaiser Family Foundation has performed their 2005 Employer Health Benefits Annual Survey.  Some interesting trends:

We can see the trend that employees are offered conventional health less frequently over time.  On the other hand, four out of five employers have choosen to offer a PPO plan to in 2005.  Three out of five workers in the survey elected a PPO among the choices given at their workplace.  The popularity of the PPO plan may be due to the fact that:

1. Firms offer PPOs since they are less expensive than conventional insurance.
2. PPOs offer more consumer choice than HMOs.  Most consumers prefer to elect their own health care providers; PPOs allow them to do that (at a cost if the physician is not in the network) while still maintaining a competitive price compared to HMOs.
3. The backlash against HMOs in the late 90s may have hurt the HMO reputation somewhat.  Nevertheless, one in five individuals who have employer provided insurance have an HMO.

With President Bush’s HSA initiative, I would expect the number of people with conventional insurance will fall even more.