TEXT Table 1. Full-time employees participating in selected employee benefit programs, medium Table 1. Full-time employees participating in selected employee benefit programs, medium Table 2. Medical care benefits: Percent of participants by fee arrangement, full-time Table 3. Medical care benefits: Percent of participants by required contribution, Table 4. Part-time(1) employees participating in selected employee benefit programs, medium Table 4. Part-time(1) employees participating in selected employee benefit programs, medium Table 5. Full-time employees participating in selected Table 5. Full-time employees participating in selected Technical contact: USDL: 94-477 EBS Staff (202) 606-6222 Media contact: Kathyrn Hoyle (202) 606-5902 FOR RELEASE: 10 A.M. (EDT) Friday, September 30, 1994 BLS REPORTS ON EMPLOYEE BENEFITS IN MEDIUM AND LARGE PRIVATE ESTABLISHMENTS, 1993 More employees in medium and large private establishments participated in non-traditional health care plans in 1993 than in 1991, according to a 1993 survey conducted by the U.S. Department of Labor's Bureau of Labor Statistics. Four-fifths of full-time employees participated in employer-provided medical care plans in both 1991 and 1993, but significant shifts occurred in the major types of plans. Non-traditional health care plans, such as health maintenance organizations (HMOs) and preferred provider organizations (PPOs), covered half the full-time employees with employer-funded medical care benefits in 1993, up from one-third in 1991. In contrast, participation in traditional fee-for-service plans declined from two-thirds of medical care participants in 1991 to one-half in 1993. In addition, a greater proportion of covered employees were required to contribute toward individual and family coverage in 1993 than in 1991. The 1993 survey provides information on the incidence and characteristics of benefit plans for an estimated 34 million employees in establishments with 100 workers or more. Of that total, nearly 29 million employees were full time and about 5.6 million were part time. BENEFITS FOR FULL-TIME EMPLOYEES IN MEDIUM AND LARGE PRIVATE ESTABLISHMENTS Among the most prevalent benefits provided to full-time employees in medium and large private establishments in 1993 were medical care, dental care, life insurance, retirement plans, paid holidays, paid vacations, and paid sick leave; each of these benefits was provided to a majority of full-time workers. (See table 1.) On the other hand, such benefits as paid personal leave, sickness and accident insurance, and long- term disability insurance were less frequently provided to full-time employees. Medical Care Benefits Fee-for-service plans, the traditional way of providing medical care benefits, covered one-half of medical care participants in 1993, down from two-thirds in 1991. Under such plans, individuals receive medical care from doctors and facilities that they choose; the plan reimburses either the provider or the individual for some or all of the cost. In 1993, nine-tenths of the workers covered by such plans were required to seek approval from their plan before certain types of health care services were received. Such approval, broadly termed managed care, typically includes requirements for plan certification prior to hospitalization and second surgical opinions. When such requirements are not met, the plan reduces or eliminates payments. Preferred provider organizations (PPOs) covered 26 percent of full-time workers with medical care benefits (compared with 16 percent in 1991). PPOs are a type of fee-for-service plan that offers individuals a higher benefit for services provided by a network of selected health care providers (such as hospitals and physicians), although participants may choose any provider. For example, a plan might pay 90 percent of charges for hospital services when received from a preferred provider and 80 percent for the same services when received outside the network. Additionally, 37 percent of PPO participants were subject to a lower plan deductible if they used a designated provider. For example, enrollees in PPOs may be subject to a yearly deductible of $100; however, if they go outside of the network, the deductible might be $200. (See table 2.) Health maintenance organizations (HMOs), which covered 23 percent of full-time workers with medical care benefits in 1993 (compared with 17 percent in 1991), provide prepaid services from a selected group of doctors and facilities. Coverage is often in full, or is provided at a nominal fee, for example, $10 or less for an office visit. If care is provided outside of the HMO, the individual will not be reimbursed for the services rendered. One additional type of health care plan, exclusive provider organizations, covered 1 percent of medical care participants in 1993. These plans have arrangements with specific providers to offer medical services at lower prices similar to PPOs. Medical care received from other providers is not paid for by the plan. In 1993, three-fifths of the full-time employees with medical coverage were required to contribute toward individual coverage; in cases where a set contribution was required, monthly premiums averaged $32. Three-fourths of covered workers had to pay part of the cost for family coverage, with an average of $107 per month. (See table 3.) In 1991, just over one-half of the participants had to contribute to the cost of individual coverage; the average monthly cost was $27. Contributions were required from approximately two-thirds of participants for family coverage, at an average cost of $97 per month. Life and Disability Insurance Life insurance protection, nearly always paid for entirely by employers, was provided to nine-tenths of full-time workers in medium and large private establishments in 1993. Three-fifths of the life insurance participants were provided benefits based on salary, typically one or two times annual pay. Nearly all of the remaining participants had benefits specified as flat amounts, averaging $15,500. Sickness and accident insurance plans, which provide either a percentage of a worker's pay or a flat amount per week during a period of disability, covered slightly over two-fifths of full-time workers in 1993. A typical sickness and accident insurance plan imposes a 7-day waiting period before benefits (commonly 50 or 60 percent of regular pay) begin, with payments continuing for a maximum of 26 weeks. When an employee is disabled for a longer period of time, or indefinitely, income replacement benefits may be available through a long-term disability insurance plan. Two-fifths of full-time employees in 1993 participated in a long-term disability insurance plan; seven-tenths of these workers had coverage fully paid by their employer. Typically, long-term disability insurance plans provide a percentage of pre-disability pay, usually 60 percent. Defined Contribution Plans Nearly one-half of full-time employees in medium and large private establishments participated in one or more defined contribution plans in 1993. These plans, which usually specify the employer's contribution but cannot predetermine the employee's actual amount of benefits, include savings and thrift (covering approximately three-tenths of full-time workers), deferred profit sharing (one-eighth), and money purchase pension and stock ownership plans (each less than one-tenth). Most participants were in plans that required employee contributions toward coverage. Nearly two-fifths of the full-time workers covered by the survey participated in 401(k) plans with employer contributions. These plans are a subset of the defined contribution plans just described. Most of these plans allow employees to save money on a tax-deferred basis and can be used to supplement Social Security and defined benefit pension plans upon retirement. Just over one-half of the employees participating in 401(k) plans were allowed to transfer or "rollover" amounts received from a plan of a former employer in order to continue the tax deferral on that money. In contrast, however, many 401(k) plans allow use of the funds before retirement through loans and withdrawals. For example, two-fifths of covered employees were allowed to borrow from their accounts (usually for any reason) or to withdraw funds (often for hardship reasons, such as medical or educational expenses) in accordance with IRS provisions. Defined Benefit Pension Plans Defined benefit pension plans, which specify a formula for determining an employee's annuity, covered about three-fifths of full-time workers in 1993. Just over one-half of the plan participants were eligible for full (unreduced) benefits before age 65 upon meeting a service requirement, usually 10 years or more. Three of five participants were in plans paying benefits based on a terminal earnings formula, which provides a pension equal to a percentage of the employee's annual pay averaged over the final years of employment times years of service. Participants with terminal-earnings formulas typically had earnings defined as the average over a 5-year period. One out of 10 full-time employees with a defined benefit pension plan were covered by a portability provision to move accumulated benefits from one employer to another. Virtually all of these participants were covered by either a multiemployer plan established by a union or a single employer plan offered by an establishment, such as in the utilities industry. If an employee moved to another employer, benefits from the prior employer, usually in the form of years of credited service, were transferred. Family-Related Benefits Family care benefits were provided through a variety of employee benefit programs in 1993. Parental leave plans provide time off for mothers and fathers to care for newborn or newly adopted children. Such plans, as defined for the survey, are separate from vacations, which also may be used for parenting purposes. Three-fifths of full-time employees had unpaid maternity leave available, with the maximum leave averaging about 4.5 months. Just over one-half of full-time employees had unpaid paternity leave available. Paid parental leave was rare. Most of these data on parental leave were collected prior to the August 1993 effective date of the Family and Medical Leave Act. Seven percent of full-time employees in medium and large private establishments were eligible for child care benefits subsidized by their employer. This benefit includes both on-site or near-site child care facilities and reimbursement of employee child care expenses. A more prevalent means of assisting employees with child care expenses was through reimbursement accounts (commonly known as Flexible Spending Accounts, or FSAs) which characteristically cover dependent care, health care premiums, or out-of- pocket health care expenses. One-half of full-time employees were eligible for such accounts, up from 36 percent in 1991. Most often, these accounts are funded solely by employee pretax dollars. BENEFITS FOR PART-TIME WORKERS IN MEDIUM AND LARGE PRIVATE ESTABLISHMENTS In addition to collecting data for full-time workers in medium and large private establishments, the Bureau of Labor Statistics also collected data for part-time workers. For virtually every benefit, a smaller percentage of part-time workers were covered as compared with full-time workers. Paid vacations and holidays were among the most prevalent benefits available to part-time workers in 1993, while insurance and retirement plans were less common. (See table 4.) Because of the limited incidence of benefits among part- time workers, plan provisions could not be examined to the same extent as for full-time workers. About one-half of part-time employees in medium and large private establishments in 1993 received paid holidays and paid vacations. When these benefits were provided, they were typically similar to those of full-time workers, but prorated based on the work schedule of the part-time employee. Medical care and life insurance benefits each covered approximately one-fourth of part-time employees in 1993. Retirement benefits were provided to two-fifths of part-time workers. COMPARISONS WITH SMALL ESTABLISHMENTS Almost without exception, the extent of benefits in medium and large private establishments in 1993 was higher than in small private establishments (those with fewer than 100 workers) surveyed in 1992. (See table 5.) Although medical coverage for full-time employees was 82 percent for workers in large establishments compared with 71 percent in small, the gap was wider for other benefits. For example, 62 percent of full-time employees in medium and large establishments had dental care compared with 33 percent in small establishments. Ninety-one percent of workers in medium and large establishments had life insurance compared with 64 percent in small. Similar differences existed for retirement benefits: While 78 percent of the full-time employees in medium and large private establishments had some form of retirement plan, 45 percent of the employees in small private establishments had such coverage. Employees in medium and large private establishments also had a higher incidence of coverage for time-off benefits than those in small private establishments. About one-half of workers in small establishments had provisions for funeral and jury duty leave while over four-fifths of workers in medium and large establishments had these benefits. About one-fifth of workers in small establishments could receive full or partial pay for military leave compared with just over one-half of workers in medium and large establishments. Differences were more pronounced for unpaid maternity leave; just under one-fifth of employees in small establishments could take this unpaid time off while three-fifths of workers in medium and large establishments could receive this benefit. (Most of these data on parental leave were collected prior to the August 1993 effective date of the Family and Medical Leave Act.) TECHNICAL NOTE The Employee Benefits Survey (EBS) data are collected jointly with the BLS Employment Cost Index (ECI). The ECI provides quarterly data on the changes in employers' costs of wages, salaries, and employee benefits. In addition, data on the cost per hour worked of compensation components are published annually from the ECI. The sample of establishments from which the EBS and ECI data are collected is updated periodically. Each year, new sample establishments in selected industries are introduced into the survey, while older sample establishments are removed from the survey. In addition, a group of newly opened establishments in all industries is included in the EBS sample to ensure representation of the current mix of medium and large private establishments. Benchmark adjustments were applied to the data to estimate current employment in each industry. More details on sampling and estimation procedures will appear in the Technical Note to Employee Benefits in Medium and Large Private Establishments, 1993, which will be published this fall. Benefits data are available for all covered employees combined and separately for three broad occupational groups: Professional, technical, and related employees; clerical and sales employees; and blue- collar and service employees. Definitions of these occupational groups may be found in the tables at the end of this release. Data also are available for full-time and part-time employees. Workers were classified as either full time or part time in accordance with practices of surveyed establishments. The Employee Benefits Survey is collected on a 2-year cycle. During 1994, data are being collected on benefits provided to workers in small private establishments (those employing fewer than 100 workers) and to workers in state and local governments. The survey of medium and large private establishments will be conducted again in 1995. Availability of Survey Results Detailed tabulations of the benefit provisions, in addition to estimates of sample error on all data, are currently being developed. Upon completion of analysis of these data, the results will be published in the bulletin, Employee Benefits in Medium and Large Private Establishments, 1993. Benefits data for employees in small private establishments (those employing fewer than 100 workers) are currently available in Employee Benefits in Small Private Establishments, 1992 (Bureau of Labor Statistics, Bulletin 2441, May 1994). Data for governments are currently available in Employee Benefits in State and Local Governments, 1992 (Bureau of Labor Statistics Bulletin 2444, July 1994). For combined 1991-92 data, which provide information on benefits provided to all workers in private industry and state and local governments, see Ann C. Foster, "Employee Benefits in the United States, 1991-1992," Compensation and Working Conditions, July 1994, pp 1-6. 3 Table 1. Full-time employees participating in selected employee benefit programs, medium and large private establishments, 1993(1) Professional, Clerical and Blue-collar Employee benefit program All employees technical, and sales and service related employees(3) employees(4) employees(2) Paid time off Holidays........................ 91 89 93 92 Vacations....................... 97 97 98 96 Personal leave.................. 21 27 31 13 Lunch period.................... 9 5 5 13 Rest period..................... 68 54 66 76 Funeral leave................... 83 86 85 80 Jury duty leave................. 90 95 92 85 Military leave.................. 53 66 54 44 Sick leave...................... 65 85 80 45 Maternity leave................. 3 4 3 1 Paternity leave................. 1 2 1 (5) Unpaid time off Maternity leave................. 60 63 60 59 Paternity leave................. 53 55 51 52 Insurance Sickness and accident insurance. 44 28 37 57 Long-term disability insurance.. 41 64 50 23 Medical care.................... 82 84 79 82 Dental care..................... 62 68 63 58 Life Insurance.................. 91 95 92 89 Retirement All retirement(6)............... 78 83 78 76 Defined benefit pension......... 56 57 54 56 Defined contribution............ 49 60 54 40 Types of plans: Savings and thrift............ 29 38 34 21 Deferred profit sharing....... 13 12 16 12 Employee stock ownership...... 3 3 4 2 Money purchase pension........ 8 13 7 6 See footnotes at end of table. Table 1. Full-time employees participating in selected employee benefit programs, medium and large private establishments, 1993(1) - Continued Professional, Clerical and Blue-collar Employee benefit program All employees technical, and sales and service related employees(3) employees(4) employees(2) Retirement Types of plans: 401(k) plans with employer contribution................. 36 46 44 26 Other benefits Flexible benefits plans......... 12 21 13 6 Reimbursement accounts.......... 52 68 62 37 Child care...................... 7 12 6 4 1 Except for maternity and paternity leave and reimbursement accounts, benefits paid for entirely by the employee were excluded from the tabulations. 2 Includes professional, technical, executive, and administrative occupations. 3 Includes clerical, administrative support, and sales occupations. 4 Includes production, craft, repair, laborer, and service occupations. 5 Less than 0.5 percent. 6 Includes defined benefit pension plans and defined contribution retirement plans. Some employees participated in both types of plans. NOTE: Workers reported in maternity and paternity leave plans and the category, other benefits, are eligible for these benefits, but may not participate. For all other benefits reported, workers participate in the plans. Table 2. Medical care benefits: Percent of participants by fee arrangement, full-time employees, medium and large private establishments, 1993 Professional, Clerical and Blue-collar Type of fee arrangement All employees technical, and sales and service related employees employees employees Total........................... 100 100 100 100 Fee-for-service................. 50 41 42 59 Health maintenance organization. 23 28 27 18 Preferred provider organization. 26 29 30 22 Exclusive provider organization. 1 2 1 1 NOTE: Because of rounding, sums of individual items may not equal totals. Where applicable, dashes indicate no employees in this category. Table 3. Medical care benefits: Percent of participants by required contribution, full-time employees, medium and large private establishments, 1993 Professional, Clerical and Blue-collar Employee contributions All employees technical, and sales and service related employees employees employees Individual coverage Total........................... 100 100 100 100 Employee contribution required.. 61 67 65 55 Employee contribution not required..................... 37 31 32 44 Not determinable................ 2 2 3 1 Family coverage Total........................... 100 100 100 100 Employee contribution required.. 76 82 79 70 Employee contribution not required..................... 21 15 17 28 Not determinable................ 3 3 4 2 Average monthly contribution(1) Individual...................... $31.55 $31.87 $33.84 $29.90 Family.......................... 107.42 113.95 115.42 98.72 1 The average monthly contribution includes those plans requiring the employee to pay a flat monthly contribution. NOTE: Because of rounding, sums of individual items may not equal totals. Table 4. Part-time(1) employees participating in selected employee benefit programs, medium and large private establishments, 1993(2) Professional, Clerical and Blue-collar Employee benefit program All employees technical, and sales and service related employees(4) employees(5) employees(3) Paid time off Holidays........................ 48 36 57 45 Vacations....................... 55 55 57 54 Personal leave.................. 14 7 20 10 Lunch period.................... 2 3 2 2 Rest period..................... 59 67 67 49 Funeral leave................... 44 42 57 33 Jury duty leave................. 49 54 52 46 Military leave.................. 14 16 18 9 Sick leave...................... 26 39 26 22 Maternity leave................. 1 2 (6) 1 Paternity leave................. 1 2 (6) (6) Unpaid time off Maternity leave................. 36 43 38 33 Paternity leave................. 32 35 33 30 Insurance Sickness and accident insurance. 17 19 12 21 Long-term disability insurance.. 4 10 5 1 Medical care.................... 24 33 22 24 Dental care..................... 17 27 17 14 Life Insurance.................. 25 36 27 20 Retirement All retirement(7)............... 40 51 45 33 Defined benefit pension......... 26 31 29 23 Defined contribution............ 23 24 32 16 Types of plans: Savings and thrift............ 8 6 15 4 Deferred profit sharing....... 9 3 12 8 Employee stock ownership...... 2 1 4 1 Money purchase pension........ 4 14 1 3 See footnotes at end of table. Table 4. Part-time(1) employees participating in selected employee benefit programs, medium and large private establishments, 1993(2) - Continued Professional, Clerical and Blue-collar Employee benefit program All employees technical, and sales and service related employees(4) employees(5) employees(3) Retirement Types of plans: 401(k) plans with employer contribution................. 15 7 24 9 Other benefits Flexible benefits plans......... 5 16 4 3 Reimbursement accounts.......... 19 37 22 11 Child care...................... 5 20 2 4 1 Employees are classified as part-time in accordance with practices of surveyed establishments. 2 Except for maternity and paternity leave and reimbursement accounts, benefits paid for entirely by the employee were excluded from the tabulations. 3 Includes professional, technical, executive, and administrative occupations. 4 Includes clerical, administrative support, and sales occupations. 5 Includes production, craft, repair, laborer, and service occupations. 6 Less than 0.5 percent. 7 Includes defined benefit pension plans and defined contribution retirement plans. Some employees participated in both types of plans. NOTE: Workers reported in maternity and paternity leave plans and the category, other benefits, are eligible for these benefits, but may not participate. For all other benefits reported, workers participate in the plans. Table 5. Full-time employees participating in selected employee benefit programs, medium and large private establishments, 1993 and small private establishments, 1992 Medium and Small private Employee benefit program large private establishment- establishment- s, 1992 s, 1993 Paid time off Holidays........................ 91 82 Vacations....................... 97 88 Personal leave.................. 21 12 Lunch period.................... 9 9 Rest period..................... 68 49 Funeral leave................... 83 50 Jury duty leave................. 90 58 Military leave.................. 53 21 Sick leave...................... 65 53 Maternity leave................. 3 2 Paternity leave................. 1 1 Unpaid time off Maternity leave................. 60 18 Paternity leave................. 53 8 Insurance Sickness and accident insurance. 44 26 Long-term disability insurance.. 41 23 Medical care.................... 82 71 Dental care..................... 62 33 Life Insurance.................. 91 64 Retirement All retirement.................. 78 45 Defined benefit pension......... 56 22 Defined contribution............ 49 33 Types of plans: Savings and thrift............ 29 14 Deferred profit sharing....... 13 16 See footnotes at end of table. Table 5. Full-time employees participating in selected employee benefit programs, medium and large private establishments, 1993 and small private establishments, 1992 - Continued Medium and Small private Employee benefit program large private establishment- establishment- s, 1992 s, 1993 Retirement Types of plans: Employee stock ownership...... 3 1 Money purchase pension........ 8 5 401(k) plans with employer contribution................. 36 19 Other benefits Flexible benefits plans......... 12 2 Reimbursement accounts.......... 52 14 Child care...................... 7 2 NOTE: Workers reported in maternity and paternity leave plans and the category, other benefits, are eligible for these benefits, but may not participate. For all other benefits reported, workers participate in the plans.