Exhibit 1. Average Total Employee-Only Premium
at Private-Sector Establishments, by Firm Size, 2006
$5,000
$4,500
$4,000
$3,500
$3,000
$2,500
$2,000
$1,500
$1,000
$500
$0
$4,498
$4,118
Total
<10
$4,241
10-24
$4,035
$4,112
$4,066
25-99
100-999
1,000+
Number of Employees
Data: Agency for Healthcare Research and Quality, Medical Expenditure Panel Survey.
Source: P. Fronstin, Capping the Tax Exclusion for Employment-Based Health Coverage: Implications for Employers
and Workers (Washington, D.C.: Employee Benefit Research Institute, Jan. 2009).
THE
COMMONWEALTH
FUND
Exhibit 2. Average Total Family Premium at Private-Sector
Establishments, by Geographic Region, 2008
$16,000
$14,000
$13,656
$12,680
$12,809
$12,351
$12,252
Midwest
West
South
$12,000
$10,000
$8,000
$6,000
$4,000
$2,000
$0
Average
Northeast
Region
Data: Kaiser/HRET 2008.
Source: P. Fronstin, Capping the Tax Exclusion for Employment-Based Health Coverage: Implications for Employers
and Workers (Washington, D.C.: Employee Benefit Research Institute, Jan. 2009).
THE
COMMONWEALTH
FUND
Exhibit 3. ESI Tax Subsidies in Absolute Dollars and as a
Percentage of After-Tax Income, for Tax Units with ESI, 2004
Average Subsidy
Subsidy as a Percentage
of After-Tax Income
$580
9.7%
$10,000–$20,000
$1,168
8.4%
$20,000–$30,000
$1,622
7.6%
$30,000–$40,000
$1,621
5.8%
$40,000–$50,000
$1,733
5.0%
$50,000–$75,000
$1,960
4.4%
$75,000–$100,000
$2,298
3.9%
$100,000–$200,000
$2,690
3.2%
$200,000 and over
$2,943
1.0%
All
$1,945
3.5%
Income
Less than $10,000
Data: Tax Policy Center calculations based on HIPSM database.
Source: L. Burman, B. Garrett, and S. Khitatrakun, “The Tax Code, Employer-Sponsored Insurance and the
Distribution of Tax Subsidies” in H. J. Aaron and L. E. Burman (eds.), Using Taxes to Reform Health Insurance:
Pitfalls and Promises, Brookings Institution, 2008.
THE
COMMONWEALTH
FUND
Exhibit 4. Current ESI Tax Subsidies in Absolute Dollars and as a
Percentage of After-Tax Income, for Tax Units with ESI, 2004
Average Subsidy (Dollars)
Subsidy as a Percentage of Income
$3,500
12.0
$2,943
$3,000
$2,690
$2,298
$2,500
$2,000
$1,622 $1,621 $1,733
$1,500
$1,000
$1,960
$1,168
10.0
8.0
6.0
9.7
8.4
7.6
5.8
5.0
4.4
4.0
$580
$500
2.0
$0
0.0
3.9
3.2
1.0
<10 10-20 20-30 30-40 40-50 50-75 75- 100- 200+
100 200
<10 10-20 20-30 30-40 40-50 50-75 75- 100- 200+
100 200
Income (thousands),
Income (thousands),
Tax Units with ESI
Tax Units with ESI
Data: Tax Policy Center calculations based on HIPSM database.
Source: L. Burman, B. Garrett, and S. Khitatrakun, “The Tax Code, Employer-Sponsored Insurance and the
Distribution of Tax Subsidies” in H. J. Aaron and L. E. Burman (eds.), Using Taxes to Reform Health Insurance:
Pitfalls and Promises, Brookings Institution, 2008.
THE
COMMONWEALTH
FUND
Exhibit 5. Effect of Ending Current ESI Tax Subsidies,
for Tax Units with ESI, 2004
Percentage Increase in
Total Income Taxes
Changes in Average
Income Tax Rates
60
50
14
48.1
12.6
12
10
40
8
28.4
30
19.9
20
6
17.4
4.9
4
12.6
10
1.9
2
1.7
1.0
0.6
0.7
0.7
0.1
0
0
30-40
40-50
50-75
75-100
100-200
200+
10-20 20-30 30-40 40-50 50-75 75-100 100200
Income (thousands),
Income (thousands),
Tax Units with ESI
Tax Units with ESI
Note: Percentage increase in total income taxes is change in tax liability divided by baseline tax liability. Data on
percentage increase is not shown for tax units with less than $30,000 in income due to very low baseline tax liability.
Change in average income tax rates is new tax divided by new income minus baseline tax divided by baseline income.
Data: Tax Policy Center calculations based on HIPSM database.
200+
THE
COMMONWEALTH
FUND