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Low-Wage Workers Feel the Pinch on Health Insurance

The Wall Street Journal-Washington Wire, Sep 18, 2014
Think Tank

We did not see big changes in employer-based coverage in the Kaiser-HRET annual Employer Health Benefit Survey released last week. Mostly this is good news, particularly on the cost side where premiums increased just 3%.

But one long-term trend that is not so good is how this market works for firms with relatively large shares of lower-wage workers (which we define as firms where at least 35% of employees earn less than $23,000). These low-wage firms often do not offer health benefits at all. And, as the chart below shows, when they do offer coverage, it has lower premiums on average (likely meaning skimpier coverage) and requires workers to pay more for it. Workers in low-wage firms pay an average of $6,472 for family coverage, compared with $4,693 for workers in higher wage firms.

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