"The implications of the decline in the small-group market are not well-understood," Meiselbach and Abraham write. "For example, we still cannot say how the contraction of the small-group market has affected workers, employers, and public insurance program finances."

Related: What will it take to lure small employers back to the fully insured group health insurance?

If the workers at small employers are going without health coverage altogether, that's a problem to be solved, but, if the workers are getting coverage through Medicaid or the Affordable Care Act public exchange system, the impact might be ambiguous, the researchers say.

"To understand whether we should continue to make efforts to try to keep the market afloat or let it be replaced with other options, we first need to better understand the consequences," the researchers add.

The researchers are looking at the same data that state insurance regulators are seeing. An analyst at the National Association of Insurance Commissioners recently told officials at an NAIC meeting that enrollment in fully insured small-group plans is clearly shrinking.

Some executives in the commercial health insurance market say the future of commercial health coverage lies in individual coverage health reimbursement arrangements and other "cash for coverage" arrangements.

Mark Bertolini, who's the former chief executive officer of Aetna and is now the CEO of Oscar Health, recently said employers should get out of the health benefits market altogether.

But other observers have questioned whether making dramatic changes to the current U.S. approach to health benefits is a good idea.

"We do have a system where half of Americans get health coverage that they generally like," Adam Beck, an employer policy specialist at America's Health Insurance Plans, said at an Employee Benefit Research Institute policy forum in December. "This is not a system that needs to be entirely disrupted."

Meiselbach and Abraham say in their paper that one obstacle to strengthening the small-group health insurance market is that efforts to help an insurance market might backfire.

In recent years, for example, officials in California and New York state have tried to help their states' fully insured small-group health insurance markets by curbing small employers' ability to use stop-loss health insurance arrangements, or insurance for health plans, to self-insure. The efforts to keep small employers from self-insuring "have been found to contribute to a decline in the rate at which small employers offer health insurance," Meiselbach and Abraham write.