Low-Wage Workers Under Health Insurance Pressure
One of America’s biggest hot-button topics right now centers on health insurance and, more specifically, cheap health insurance coverage for workers. Last week, Kaiser-HRET, a research conglomerate that does in-depth surveys on matters of health across America, released their annual Employer Health Benefit Survey, a collection of statistics to give an idea of the general progress of employer-provided benefits. Most of the news is good, thankfully. Overall, premiums increased only 3%, but some of the news is unsettling, especially for low-wage workers.
This market trend, indicated by the annual report over the years, isn’t beneficial to firms with large portions of low-wage workers (firms with 35% or more of their employees earning less than $23,000 annually). Often, these low-wage firms don’t offer benefits at all, and when coverage is offered, it’s usually minimal. The premium is low, but the coverage isn’t the best. What’s worse is how much low-wage workers pay in the long run – an average of nearly $2,000 more than high-wage workers.
Unfortunately, this also prevents low-income workers from obtaining better coverage under the Affordable Care Act. Low-wage workers are unable to find their own California health insurance because of a stipulation in the Affordable Care Act that prevents low-income workers from receiving tax credits or other benefits if their employer provides a minimum level of coverage. In certain situations, low cost health insurance could end up costing low-wage employees more, when ideally, the Affordable Care Act would have the opposite effect.
To summarize, an analysis of the last year’s health insurance statistics has shown a negative trend effecting low-income workers who are being provided benefits by their employers. The firm-provided insurance is not only insufficient, but it prevents low-income workers from receiving tax credits under the Affordable Care Act. Even with lower premiums, low-income workers annually pay more than their medium to high-income counterparts.
If the trend continues, as many experts predict it may, this could encourage companies providing insufficient coverage to drop their coverage altogether, allowing low-income workers to receive tax credits for getting their own health insurance. While that may not sound like the best outcome to many, if this were to take effect, low-income workers would probably end up better off because the money that is currently deducted to cover their health insurance would be pushed back into their paychecks.
To find out more about this trend, you can read the 2014 Employer Health Benefits Survey by following this link.
Have you felt the effects of this trend? Do you have any ideas that may solve this devastating issue? We would love to hear what you have to think, so feel free to make a comment below and share your experiences and ideas.