Self insurance, which some analysts believed would become more popular among small businesses as a response to Obamacare, has yet to make inroads into that sector.
An analysis of self-insured businesses by size, released by the Employee Benefit Research Institute, found that, through 2013, about 12 percent of small businesses were self insured. That figure has remained steady since 1996, EBRI said.
"To the degree small employers are concerned about the rising cost of providing health coverage, self-insurance may become a more attractive means to mitigate any expected regulatory cost increases. … So far (up to 2013, the latest data available), there is no evidence that they are doing so," EBRI said.
Recommended For You
However, large employers are driving the overall percentage of self-insured businesses much higher, EBRI said. Whereas 41 percent of all businesses were self-insured in 1998, by 2013 that had risen to 58 percent.
By state, the percentage ranged from Hawaii's 35 percent to more than 70 percent of businesses in Indiana and Nebraska.
"So far, there is no sign smaller firms are moving to self-insure, even though more large firms are doing so," said Paul Fronstin, director of EBRI's Health Research and Education program and author of the report.
© 2025 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.
Dan Cook
Dan Cook is a journalist and communications consultant based in Portland, OR. During his journalism career he has been a reporter and editor for a variety of media companies, including American Lawyer Media, BusinessWeek, Newhouse Newspapers, Knight-Ridder, Time Inc., and Reuters. He specializes in health care and insurance related coverage for BenefitsPRO.
