Over the past 50 years, US workers have come to expect employers to pay for some part of employee health insurance; many consider this an important part of overall compensation. However, recent economic trends have resulted in a growing disparity in health care coverage and affordability. A study by the McKinsey Global Institute (MGI) identified three divergent categories of workers that are emerging from trends in health care coverage and income growth.
The top-income category (earning on average $210,100 annually1) has enjoyed rising incomes and growing employer-paid health care benefits, which have made their out-of-pocket spending on health care a relatively small and affordable portion of total spending. The higher-middle-income category (earning an average of $84,800 annually) and the lower-middle-income group (earning on average $41,500), have also seen increasing benefits and incomes—but at a much slower rate, making the uncovered portion of their health care costs ever-more expensive. In the bottom-income category (earning an average of $14,800 a year), incomes have been stagnant, and their employers are less likely to pay for their health insurance. This group is finding any health care difficult, if not impossible, to afford.
As part of a study of widening income gaps between...