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Shrinking Number of Children Found Covered by Employer Health Insurance

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WASHINGTON--Employer-provided health insurance--the primary form of health insurance for most Americans--is increasingly less likely to provide coverage for children, the results of a new study show.

The report, completed by a Washington-based advocacy group, the Children's Defense Fund, found that almost 40 percent of all children, or 25 million youngsters under the age of 18, are not covered by health insurance through a parent's employer.

In 1977, the study says, 72.8 percent of all children were covered by health insurance through an employer-provided plan. By 1987, that proportion had dropped to 62.9 percent.

If the trend continues, the study estimates, about half of all children, and 80 percent of black children, will not be covered by employer-based health insurance by the end of the decade.

Even children who are covered under employer-sponsored plans may find their insurance to be tenuous. Over the next 28 months, due to a parent's job change, unemployment, or disability, nearly 40 percent will go without coverage at some point, the report predicts. "The voluntary system of employer-provided health insurance is in disarray, and there is no more visible sign of its decline than the unraveling of coverage for children," Marian Wright Edelman, the president of the C.D.F., said at a press conference.

Data such as those contained in the C.D.F. report are likely to fuel an already hot election-year debate about the best ways to provide health coverage for the estimated 35 million Americans who lack any insurance. About 8.4 million children, or about 13 percent of all youngsters in the United States, have neither private nor public health coverage, according to the c.D.F.

The group attributes the declining percentage of covered children to three major trends:

  • As the cost of premiums continues to rise, many employers no longer include spouses or children in their health-insurance plans;
  • Many of the new jobs created during the past decade do not include any health benefits, not even for the working parent; and
  • Even for parents who want to buy family health plans on their own to cover their children often find the cost prohibitive, sometimes reaching as high as $12,000 a year.

When offered the chance to buy health insurance for their children at lower group rates from their employers, about 90 percent of parents do so, the c.D.F. found. But a growing percentage of employers no longer offer parents the option, the group says.

Coverage of Minority Children

The report, which drew on data collected by the U.S. Census Bureau and the U.S. Department of Health and Human Services, underscores the importance of Medicaid, which is gradually being expanded to include older children, in providing health coverage to poor youngsters.

The program covered about 11.9 million children in 1990, and, if it were not for Medicaid, the number of totally uninsured children would have more than doubled, from 8.4 million to 18.1 million, the report estimates.

At the same time, the insurance situation for children from working-poor and middle-class families continues to decline, the study found.

About 63 percent of children from working-poor families, and 83.6 percent of middle-class children, had employer-based health insurance in 1977, the report says. A decade later, 47 percent of working-poor children and 79 percent of middle-class children were still covered.

Over the same decade, children were less likely to be insured, whether or not both parents worked, only one parent worked outside the home, or they came from a single-parent family, the study found.

Black and Latino children were consistently less likely to be covered by private health insurance than white children, the report says.

In 1990, two-thirds of white children had insurance from a parent's employer; in contrast, only 40 percent of black and Latino children had such coverage.

Between 1977 and 1987, black and Latino children were more likely to lose their health insurance than white children, the study found.

Copies of "Children and Health Insurance" are available for $4.50 each, postpaid, from the C.D.F. 122 C St., N.W., Washington, D.C. 20001.

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