This research is funded in part through a U.S. Health Resources and Services Administration, State Planning Grant to the Hawaii State Department of Health. Sub-Contract Research Corporation of the University of Hawaii. Research conducted by the University of Hawaii, Social

Science Research Institute in collaboration with the Hawaii State Department of Health, Hawaii Institute for Public Affairs/Hawaii Uninsured Project and the Hawaii Health Information Corporation.

1

Hawai`i Employer Sponsored Health

Insurance: MEPS-IC 2003

Health Resources and Services AdministrationState Planning Grant

7th Technical WorkshopThursday, October 13, 2005

Gerard RussoAssociate Professor of Economics

University of Hawaii

2SOURCE: Agency for Healthcare Research and Quality, Center for Financing, Access and Cost Trends, Medical Expenditure Panel Survey-Insurance Component.

OVERVIEW OF RESULTS: MEPS-IC 2003

Average Premiums are Lower in Hawaii than US

PHCA seems to affect small firms and firms with low-wage workers the most.

PLEASE NOTE: Part-time and Full-time is not specifically defined.

3SOURCE: Agency for Healthcare Research and Quality, Center for Financing, Access and Cost Trends, Medical Expenditure Panel Survey-Insurance Component.

Health Insurance Premiums: MEPS-IC

Medical Expenditure Panel Survey (MEPS) Insurance Component (IC) Agency for Healthcare Research & Quality (AHRQ) www.ahrq.gov Internal Revenue Service (IRS) Sampling Frame Data Tabulated by AHRQ for the State of Hawaii Employer Sponsored Insurance (ESI) www.meps.ahrq.gov James M. Branscome <JBransco@AHRQ.GOV>

4SOURCE: Agency for Healthcare Research and Quality, Center for Financing, Access and Cost Trends, Medical Expenditure Panel Survey-Insurance Component.

Internet Citations: MEPS-IC 2003

Agency for Healthcare Research and Quality. 2003 Employer-Sponsored Health Insurance Data. Private-Sector Data by Firm Size and State (Table II Series).  Published July 2005. http://www.meps.ahrq.gov/MEPSDATA/ic/2003/Index203.htm

Agency for Healthcare Research and Quality. 2003 Employer-Sponsored Health Insurance Data. Private-Sector Data by Industry Groupings and State (Table V Series). Published July 2005. http://www.meps.ahrq.gov/MEPSDATA/ic/2003/Index503.htm

Agency for Healthcare Research and Quality. 2003 Employer-Sponsored Health

Insurance Data. Private-Sector Data by Ownership Type and Age of Firm and State (Table VI Series). Published July 2005. http://www.meps.ahrq.gov/MEPSDATA/ic/2003/Index603.htm

Agency for Healthcare Research and Quality 2003 Employer-Sponsored Health Insurance Data. Private-Sector Data by Proportion of Employees Who Are Full-time or Low-wage and State (Table VII Series). Published July 2005.http://www.meps.ahrq.gov/MEPSDATA/ic/2003/Index703.htm

Agency for Healthcare Research and Quality 2003 Employer-Sponsored Health Insurance Data. Private-Sector Data by Average Wage Quartiles and State (Table VIII Series). Published July 2005. http://www.meps.ahrq.gov/MEPSDATA/ic/2003/Index803.htm

5SOURCE: Agency for Healthcare Research and Quality, Center for Financing, Access and Cost Trends, Medical Expenditure Panel Survey-Insurance Component.

Average Family Premiums, MEPS-IC: Hawaii and US 1996-2003Year Hawaii US

1996 $5,319.26 $4,953.68

1997 $5,337.13 $5,332.29

1998 $6,696.91a $5,590.41

1999 $5,539.34 $6,058.12

2000 $6,391.68 $6,772.47

2001 $7,405.92 $7,508.94

2002 $7,768.24 $8,469.01

2003 $7,886.84 $9,248.92 aNote: The 1998 MEPS-IC sample for Hawaii is too small to compute reliable estimates.

6SOURCE: Agency for Healthcare Research and Quality, Center for Financing, Access and Cost Trends, Medical Expenditure Panel Survey-Insurance Component.

Average Single Premiums, MEPS-IC: Hawaii and US 1996-2003

Year Hawaii US

1996 $2,005.45 $1,991.64

1997 $2,021.94 $2,050.82

1998 $2,583.84a $2,174.35

1999 $2,207.89 $2,324.76

2000 $2,747.87 $2,654.67

2001 $2,698.29 $2,889.19

2002 $2,722.89 $3,188.90

2003 $3,019.83 $3,481.22 aNote: The 1998 MEPS-IC sample for Hawaii is too small to compute reliable estimates.

7SOURCE: Agency for Healthcare Research and Quality, Center for Financing, Access and Cost Trends, Medical Expenditure Panel Survey-Insurance Component.

Simple Annual Premium Growth Model:UH Non-Linear Discrete-Time Estimation

tt gPP 10

8SOURCE: Agency for Healthcare Research and Quality, Center for Financing, Access and Cost Trends, Medical Expenditure Panel Survey-Insurance Component.

Estimated Annual Nominal Growth Rates: 1996-2003UH Non-Linear Discrete-Time Estimates

Family PremiumsHawaii 6.27%US 9.93%

Single PremiumsHawaii 5.57%US 9.14%

9SOURCE: Agency for Healthcare Research and Quality, Center for Financing, Access and Cost Trends, Medical Expenditure Panel Survey-Insurance Component.

Average Family Premiums in Hawaii and US: 1996-2003 MEPS-IC Actual, 2004-2006 UH ProjectionYear Hawaii-Actual US-Actual Hawaii-Predicted US-Predicted

1996 5319.26 4953.68 5237.57 4725.72

1997 5337.13 5332.29 5565.93 5195.17

1998 6696.91 5590.41 5914.89 5711.25

1999 5539.34 6058.12 6285.72 6278.61

2000 6391.68 6772.47 6679.80 6902.32

2001 7405.92 7508.94 7098.58 7587.99

2002 7768.24 8469.01 7543.62 8341.78

2003 7886.84 9248.92 8016.57 9170.45

2004 8519.16 10081.44

2005 9053.27 11082.92

2006 9620.85 12183.89

10SOURCE: Agency for Healthcare Research and Quality, Center for Financing, Access and Cost Trends, Medical Expenditure Panel Survey-Insurance Component.

Family Premium Trend Line: Hawaii and US 1996-2006University of Hawaii Estimates

0

2000

4000

6000

8000

10000

12000

14000

Hawaii

US

HI-Predicted

US-Predicted

11SOURCE: Agency for Healthcare Research and Quality, Center for Financing, Access and Cost Trends, Medical Expenditure Panel Survey-Insurance Component.

Average Single Premiums in Hawaii and US: 1996-2003 MEPS-IC Actual, 2004-2006 UH Projection

Year Hawaii-Actual US-Actual Hawaii-Predicted US-Predicted

1996 2005.45 1991.64 2053.18 1872.06

1997 2021.94 2050.82 2167.53 2043.12

1998 2583.84 2174.35 2288.25 2229.81

1999 2207.89 2324.76 2415.69 2433.56

2000 2747.87 2654.67 2550.23 2655.93

2001 2698.29 2889.19 2692.26 2898.61

2002 2722.89 3188.9 2842.20 3163.47

2003 3019.83 3481.22 3000.50 3452.54

2004 3167.60 3768.02

2005 3344.02 4112.32

2006 3530.26 4488.09

12SOURCE: Agency for Healthcare Research and Quality, Center for Financing, Access and Cost Trends, Medical Expenditure Panel Survey-Insurance Component.

Single Premium Trend Line: Hawaii and US 1996-2006University of Hawaii Estimates

0500

100015002000250030003500400045005000

Hawaii

US

HI-Predicted

US-Predicted

13SOURCE: Agency for Healthcare Research and Quality, Center for Financing, Access and Cost Trends, Medical Expenditure Panel Survey-Insurance Component.

Private Sector Family Premiums by Firm Size: Hawaii and United States 2003

9,233 9,0388,111

7,2647,8607,8789,3879,340 9,375 9,286

$0

$2,000

$4,000

$6,000

$8,000

$10,000

less

than 10

10 to 24 25 to 99 100 to

999

1000 or

more

Number of Employees

14SOURCE: Agency for Healthcare Research and Quality, Center for Financing, Access and Cost Trends, Medical Expenditure Panel Survey-Insurance Component.

Employee Contributions as a Percent of Family Premiums by Firm Size: Hawaii and United States 2003

18.7%

28.8%27.5%

26.0%

42.1%

20.2%

41.5%

21.8%

28.4%

24.7%

31.1%

22.3%

0%

10%

20%

30%

40%

50%

less

than 10

10 to

24

25 to

99

100 to

999

1000 or

more

Total

Number of Employees

15SOURCE: Agency for Healthcare Research and Quality, Center for Financing, Access and Cost Trends, Medical Expenditure Panel Survey-Insurance Component.

Private Sector Single Premiums by Firm Size: Hawaii and United States 2003, ESI

$2,742 $2,849

$3,745

$2,880$3,352

$3,834

$3,430 $3,430$3,470$3,568

0500

1,0001,5002,0002,5003,0003,5004,0004,500

less than

10

10 to 24 25 to 99 100 to

999

1000 or

more

Number of Employees

16SOURCE: Agency for Healthcare Research and Quality, Center for Financing, Access and Cost Trends, Medical Expenditure Panel Survey-Insurance Component.

Employee Contributions as a Percent of Single Coverage Premiums by Firm Size: Hawaii and United States 2003

8.3%

17.4%

3.4%3.3%

8.2%

15.0%

7.6%

17.7%18.4% 18.4%

12.4%

15.1%

0%

5%

10%

15%

20%

less

than 10

10 to

24

25 to

99

100 to

999

1000 or

more

TotalNumber of Employees

17SOURCE: Agency for Healthcare Research and Quality, Center for Financing, Access and Cost Trends, Medical Expenditure Panel Survey-Insurance Component.

Percent of Private Establishments that Offer Health Insurance by Firm Size: Hawaii and United States 2003

86.2%

100.0%99.1%99.8% 99.9%

74.6%

56.2%

93.5%81.0%

98.6%

35.6%

66.2%

0%

20%

40%

60%

80%

100%

120%

less

than 10

10 to

24

25 to

99

100 to

999

1000 or

more

TotalNumber of Employees

18SOURCE: Agency for Healthcare Research and Quality, Center for Financing, Access and Cost Trends, Medical Expenditure Panel Survey-Insurance Component.

Number of Employees Part-time and Full-time by Average Wage of Work Force: Hawaii 2003

97,80688,35998,616

353,283

68,502

11,33311,261

82,58639,579 20,412

050000

100000150000200000250000300000350000400000

Average Wage

Full-Time

Part-Time

Note: Part-time refers to no specific number of hours.

19SOURCE: Agency for Healthcare Research and Quality, Center for Financing, Access and Cost Trends, Medical Expenditure Panel Survey-Insurance Component.

Percent of Private Establishments that Offer Health Insurance by Average Wage of Work Force: Hawaii and United States

2003

100.0%88.2%

90.2% 86.2%77.8% 79.7%

72.0%

56.2%39.0%

59.1%

0%

20%

40%

60%

80%

100%

120%

Quartile I Quartile

II

Quartile

III

Quartile

IV

Total

Average Wage

20SOURCE: Agency for Healthcare Research and Quality, Center for Financing, Access and Cost Trends, Medical Expenditure Panel Survey-Insurance Component.

Percent of Full-time Employees Enrolled in Health Insurance at Establishments that offer Health Insurance by Average Wage of Work Force: Hawaii and United States 2003

82.9%

74.4%

79.3%

66.0%

82.1%77.0%

55.2%

69.5%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

Quartile I Quartile II Quartile III Quartile IV

Average Wage

21SOURCE: Agency for Healthcare Research and Quality, Center for Financing, Access and Cost Trends, Medical Expenditure Panel Survey-Insurance Component.

Percent of Part-time Employees Enrolled in Health Insurance at Establishments that offer Health Insurance by Average Wage of Work Force: Hawaii and United States 2003

48.1%

35.2%

41.1%34.4%

27.4% 26.9%26.1%

15.3%7.4%

19.4%

0%

10%

20%

30%

40%

50%

60%

Quartile I Quartile

II

Quartile

III

Quartile

IV

Total

Average Wage

22SOURCE: Agency for Healthcare Research and Quality, Center for Financing, Access and Cost Trends, Medical Expenditure Panel Survey-Insurance Component.

Percent of Part-time Employees Enrolled in Health Insurance at Establishments that offer Health Insurance by Average Wage of Work Force: Hawaii and United States 2003

48.1%

35.2%

41.1%34.4%

27.4% 26.9%26.1%

15.3%7.4%

19.4%

0%

10%

20%

30%

40%

50%

60%

Quartile I Quartile

II

Quartile

III

Quartile

IV

Total

Average Wage

23SOURCE: Agency for Healthcare Research and Quality, Center for Financing, Access and Cost Trends, Medical Expenditure Panel Survey-Insurance Component.

Summary

Average ESI Premiums are lower in Hawaii than US.

Low-Wage Part-Time Workers are Less Likely to be Covered by Employer-Sponsored Health Insurance. Possible Reasons Why? Tax benefits are less. Premiums as a proportion of total compensation are more. Minimum wage law prevents cash wages from adjusting

downward.