Will Employer-Sponsored Health Insurance Endure?

The u.s. r eliance o n p r i vate h ealth i nsur a nce c over age that is voluntarily provided by employers is unique among industrialized nations. Since World War II, this enterprise has become deeply embedded in, if not always appreciated by, American culture. In 2000, employment-based coverage reached its enrollment peak—164.4 million covered lives—but by 2004, that number had declined by some five million. Despite this decline, the commercial health insurance enterprise has enjoyed a period of robust financial growth in recent years, as most companies have successfully managed their way through a difficult period. However, the challenges are far from over. In the political realm, both the Right and the Left are calling for fundamental changes in the way health care is insured, with one calling for greater reliance on individual coverage and responsibility and the other relying more heavily on expanding publicly sponsored programs. More and more employers are asking whether they can continue to afford to offer coverage to their workers. One of the themes that we have returned to consistently over our twenty-five years of publication is the state of the private insurance industry, and we are revisiting that subject again in this issue. There is clearly al ot to write about, as health care expenditures continue to grow more rapidly than the general economy and are, in turn, driving rates of private insurance down while public programs grow along with an uninsured population that is approaching fifty million Americans. In our lead paper, contributing editor James Robinson reports on new types of publicprivate arrangements that have been strongly advocated by the Bush administration and the Republicancontrolled Congress. Other papers touch on issues that are challenging the insurance industry and society as well: the “graying” of group health insurance; the continuing decline in employers’ willingness to subsidize retirees’ health care coverage; and a forum