URBAN-RURAL DIFFERENCES IN EMPLOYER-BASED HEALTH-INSURANCE COVERAGE OF WORKERS

Prior research indicates that rural workers are less likely than urban workers to obtain health insurance coverage through their employer. T he reasons for this differential in coverage rates are not well unders tood. This study uses data from the 1993 Robert Wood Johnson Foundatio n Employer Health Insurance Survey to measure differences in the propo rtion of rural and urban workers who are offered insurance coverage an d in their rates of participation in offered plans, and to assess the effects of firm size, wages, and other factors in explaining the resid ential differences. Both offer rates and participation rates are lower in rural areas, but the probability of employer-based coverage among rural workers rises to the level of that of urban workers when we adju st rural firm size and wages to urban levels. Rural firms and workers are not behaviorally different from urban firms and workers; they are, however, at a greater disadvantage because of their smaller size and lower wages.