10M people likely to drop out of employer coverage this year due to COVID-19: report

Health insurance form payer plan enroll
A new analysis from the Urban Institute estimates the impact of COVID-19 on the employer-sponsored insurance market. (Valeriya/Getty)

More than 10 million people could drop out of employer-sponsored health coverage by December thanks to job losses linked to COVID-19, a new report finds.

Researchers at the Urban Institute estimate 48 million non-elderly Americans live in a household that will experience some sort of job loss related to the coronavirus pandemic. Of those people, about one-fifth were covered by insurance through their employers, according to the report.

The report projects that most of these people will regain coverage, though 3.5 million will remain uninsured. About 3.3 million will be added to a family member's policy, according to the report, while 2.8 million will enroll in Medicaid.

The remaining 600,000 will likely sign up for coverage through the Affordable Care Act's marketplaces, according to the report.

RELATED: ACA's exchange enrollment could increase by 1M due to COVID-19 job losses, Avalere study shows

About one-third (34%) of those facing job loss due to the pandemic were covered already in a family member's plan, and 27% were enrolled in Medicaid or the Children's Health Insurance Program (CHIP) prior to COVID-19.

Katherine Hempstead, senior policy adviser at the Robert Wood Johnson Foundation, said in a statement that the results highlight the disproportionate impact the pandemic is having on low-wage workers.

“The COVID-19 recession has disproportionately affected the lowest paid workers, who are the least likely to have work-based health insurance,” Hempstead said. “The loss of jobs and coverage associated with the pandemic is a huge test for our safety net, but it may not be the inflection point for the employer market that many predicted.”

Workers are also more likely to remain uninsured after losing their employer coverage in states that did not expand Medicaid, according to the report. In the second, third and fourth quarters of 2020, Medicaid and CHIP enrollment is expected to increase by 7.3% in expansion states and 3.1% in non-expansion states.

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