Expanding employment-based health insurance: is small group reform the answer?

Nearly two-thirds of all uninsured workers are employed in firms with 100 or fewer employees. Making insurance more affordable and available to small groups is high on the political agenda. Efforts to reform the small group market include making insurance more available by restricting the use of medical underwriting to deny access, and compressing rates to make it more affordable for high-risk groups. Other reforms pursued at the state level have focused on reducing the price of insurance facing all small employers. My analysis suggests that these proposals will have limited success in reducing the number of uninsured. Short of compulsory insurance, significant changes will occur only when insurance is organized around larger purchasing groups and not small employers.