Up to 10 million Americans could lose employer-sponsored healthcare due to COVID-19

The hardships of the COVID-19 pandemic have been felt acutely by hospitals, especially with elective surgeries and other lucrative service lines on hold, but the coronavirus is also having a profound impact on everyday Americans beyond just social isolation. An estimated 10 million people will likely lose their employer-sponsored health insurance as a result of pandemic-related job loss.

The findings from the Urban Institute and Robert Wood Johnson Foundation also factor in a bit of perspective: About 48 million non-elderly Americans will be part of a household in which someone loses a job due to COVID-19.

The projections are based on data on employment losses by industry, state, and demographic information published by the U.S. Department of Labor.

WHAT'S THE IMPACT?

The data has potentially challenging financial implications for hospitals and health systems, as fewer insured patients tend to translate to less business. In a Vizient webinar panel discussion in May, it was revealed that almost half of Americans said they were uncomfortable returning to a hospital setting, and that statistic included consumers who still had their insurance. 

For the 48 million in question who will be affected in some way, many of the workers and family members experiencing job loss either had insurance through another family member's job (34%) or through Medicaid or the Children's Health Insurance Program (CHIP) (27%) prior to the pandemic.

Of those people, about one-fifth, or 10.1 million, had their insurance tied to a job lost due to COVID-19. Smaller shares had coverage through the non-group insurance market, other public programs, or were uninsured.

Projections show that 3.3 million of those people will regain employer-sponsored insurance by being added to a family member's policy, 2.8 million people will enroll in Medicaid, and 600,000 people will enroll in the individual market, mainly via the Affordable Care Act's marketplace. Still, 3.5 million people will become uninsured.

What's clear in the numbers is that the COVID-19 recession is having a disproportionately large impact on low-wage workers. Higher percentages of people losing their employer insurance will become uninsured in states that did not expand Medicaid eligibility, the report found.

THE LARGER TREND

Despite the dire numbers, there was some encouragement in June, when total nonfarm payroll employment went up by 4.8 million. That brought the national unemployment rate to 11.1%, which is a decrease of 2.2% from May.

Health systems increased employment by 6,700 during the month, and healthcare employment increased in all sectors except for nursing care facilities, which lost 18,000 jobs. Total healthcare employment increased by 358,000 over the previous month, with specific increases in dental offices (190,000), physician offices (80,000), other health practitioner offices (48,000) and hospitals (6,700).

Twitter: @JELagasse
Email the writer: jeff.lagasse@himssmedia.com