12M have likely lost employer coverage amid COVID-19: report

As many as 12 million people have lost access to employer-sponsored coverage as a result of COVID-19, a new analysis shows.

Researchers at the Economic Policy Institute say 6.4 million workers have lost access to insurance through their employer amid job losses during the pandemic. When accounting for spouses and dependents in those plans, the number of people losing employer coverage is likely closer to 12 million.

Not every worker who loses employer coverage will become uninsured, as Medicaid and the individual market have proved to be key alternatives for these people, along with temporary COBRA coverage.

They estimate that Medicaid enrollment nationally has likely grown by 4 million people, according to the report. In addition, people who are newly unemployed could choose to sign on with a spouse's or family member's plan.

RELATED: Medicaid expansion will be a critical safety net as COVID-19 job losses continue nationwide, Urban Institute says

The study finds that just over 9 million people dropped out of employer-sponsored insurance between February and April 2020, at the height of social distancing, though as restrictions eased more than 2.8 million joined the employer plan market between April and July.

Findings like this should spur policymakers to consider ways to avoid bloating the uninsured population, the researchers said, and strengthen potential safety nets for the newly unemployed.

A "low-hanging fruit" policy change, for example, would be for the government to guarantee coverage for the cost of COVID-19 testing and treatment, the researchers said. 

In addition, the pandemic has highlighted the weaknesses of the employer-based insurance model overall, the researchers argue. They suggest policymakers should explore alternatives, which could range from decoupling health coverage and employment in high-churn industries like service jobs to fully overhauling the system into a single-payer model.

“The coronavirus pandemic has exposed how incomplete and threadbare the U.S. safety net and social insurance system is,” said Ben Zipperer, an economist and one of the study's authors, in a statement. “In order to help millions of Americans during the pandemic and beyond, policymakers must take swift action to address the inequities and inefficiencies in our health care system.”