Index

A

Access, 7, 334

public subsidies to improve, 18-19

risk selection affecting, 182-183

vs. coverage, 7, 234

Accountability, 237

Actuarial techniques

early development of, 56

fairness issues in, 179-182

Administration of health benefit plans

administrative services only agreements, 113, 334

in Canadian system, 110

case studies in, 128-145

complexity of, in U.S., 11-12, 149-152, 232, 240-241

cooperatives for, 127

cost of, 108-110, 151-152, 206, 240

early cost containment strategies, 73-77

employer functions in, 5-6, 11, 121-127, 149-152, 232-233

ERISA on, 303-304

legal issues in, 152-153

risk selection through practices in, 174-175

size of employer and, 121-122, 124-126

state regulation of, 296, 298-299

third-parties for, 113, 126, 152-153, 344

Admission review, 334

Adverse selection, 46, 169, 334,

see also Risk selection

Age

coverage for elderly, 77, 90

discrimination, protection against, 316

of health plan, related to enrollment age, 178

of individual, vs. group, enrollees, 168 n.1

premiums related to, 173

of uninsured workers, 93

Agency for Health Care Policy and Research, 226

Ambulatory care, definition of, 334

American Association for Labor Legislation, 58-59



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Employment and Health Benefits: A Connection at Risk Index A Access, 7, 334 public subsidies to improve, 18-19 risk selection affecting, 182-183 vs. coverage, 7, 234 Accountability, 237 Actuarial techniques early development of, 56 fairness issues in, 179-182 Administration of health benefit plans administrative services only agreements, 113, 334 in Canadian system, 110 case studies in, 128-145 complexity of, in U.S., 11-12, 149-152, 232, 240-241 cooperatives for, 127 cost of, 108-110, 151-152, 206, 240 early cost containment strategies, 73-77 employer functions in, 5-6, 11, 121-127, 149-152, 232-233 ERISA on, 303-304 legal issues in, 152-153 risk selection through practices in, 174-175 size of employer and, 121-122, 124-126 state regulation of, 296, 298-299 third-parties for, 113, 126, 152-153, 344 Admission review, 334 Adverse selection, 46, 169, 334, see also Risk selection Age coverage for elderly, 77, 90 discrimination, protection against, 316 of health plan, related to enrollment age, 178 of individual, vs. group, enrollees, 168 n.1 premiums related to, 173 of uninsured workers, 93 Agency for Health Care Policy and Research, 226 Ambulatory care, definition of, 334 American Association for Labor Legislation, 58-59

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Employment and Health Benefits: A Connection at Risk American College of Surgeons, 63 American Medical Association opposition to group health plans by, 70 opposition to social insurance proposals by, 59-60, 63, 65 American Risk and Insurance Association, 41 n.6 Americans with Disabilities Act of 1990, 117-118, 148, 316-317 application to risk selection, 185-187 confidentiality provisions of, 246 legal uncertainties in, 186 medical records management in, 17 medical underwriting in, 182 B Benefit, definition of, 43, 335 Benefit design, 114-115 basic benefits, 19-20, 193, 249, 258 cost management in, 74-75 cost sharing in, 74, 103-106 diversity in, 10, 122-126, 237-238, 242 employee assistance programs in, 118-119 employee concerns about, 136-137, 145-149 ERISA on, 84, 302 evolution of, 101-102 flexible, 119, 218, 337 in health maintenance organizations, 102 health promotion programs in, 116-119 influence on risk selection of, 171-172, 173-174 innovation in, 10, 71-72, 238-239, 242 insurable events in, 44-45, 338 Medicare, 78-79 mental health care in, 104-106 planning, in case study, 130-133, 137-139 regulating, 19-20, 193-194, 249, 258 risk selection affecting, 184-185 in sample request for proposal, 156-158, 162-165 in social insurance, 41-42, 56-57 state-mandated, 101, 249, 298 in workers' compensation programs, 115-116 Biased risk selection, see Risk selection Blue Cross plans costs of, 219 HMO sponsorship by, 126 origins of, 66-69, 71-72, 295 Blue Shield plans HMO sponsorship by, 126 in Medicare program, 78-79 origins of, 54 n.3, 68-69, 295 Bureau of the Census, Current Population Survey, 88, 93, 96 C Cafeteria plan, 335 California, 37, 108, 250 Canada, 22, 32, 33, 110, 151, 252 Capital expenditures, regulation of, 208-209 Capitation, 335 Carve-outs, for retirees, 94-95 n.6 Case management, 335 Case study contrasting cases, 142-145 employee advisory group in, 135-137 evaluating benefit plans in, 131-133 evaluating proposals in, 137-140 financial management in, 133 goal setting in, 130 implementing new benefit plan in, 140-142 legal issues in, 134 request for proposals in, 137, 155-166 small business concerns in, 143 Catastrophic expense protection, 335 Certificates of need, 209

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Employment and Health Benefits: A Connection at Risk Civilian Health and Medical Program of the Uniformed Services (CHAMPUS) , 335 Claims management definition of ''claim," 335 in ERISA, 83 in sample request for proposal, 160-161 COBRA, see Consolidated Omnibus Budget Reconciliation Act of 1985 Coinsurance, 104, 335 Commercial insurance, 55-56, 71-72 Committee on the Costs of Medical Care (1927), 60-64, 66-67 Community rating, 257 definition of, 336 in early insurance plans, 67 experience rating vs., 47 in social insurance, 42 theoretical basis of, 181 Competition ability of, to regulate health care, 207, 220-223, 240 among purchasing cooperatives, 18 effect of risk selection on, 169 managed, 37, 38, 81, 190-194 risk selection as basis for, 183 Complexity of U.S. health care system, 11-12, 149-152, 240-241 Compulsory coverage in social insurance, 41-42, 56-57 recommendations, 251-254 Confidentiality in Americans with Disabilities Act, 185-186, 246 recommendations for, 16-17, 246 worker concerns about, 148 Consolidated Omnibus Budget Reconciliation Act of 1985, 85, 313-314 Consultants, in planning health benefits, 124-126 Continuity of care problems with, 10-11, 146, 239 research on, 259 Continuity of coverage, 10-11, 239, 259 under COBRA, 85, 313-314 termination benefits, ERISA on, 84 Cooperatives health-plan purchasing, 18, 127, 214-215, 247-248, 342 regulating competition through, 191-192 Coordination of benefits, 94-95 n.6, 336 Copayment, 336 Cost management benefit designs for, 74-75 cost sharing strategies in, 217 early efforts in, 73-77 early federal initiatives, 82 flexible benefits and, 218 growth of government role in, 207-211 health planning in, 75-76, 208-209 health promotion programs in, 218 issues in, 202-204 market-based strategies for, 220-223, 240 in Medicare program, 208-209 in network plans, 217-218 obstacles to, 11, 239-240 private sector strategies for, 212-220 prospective payment system for, 211 rate-setting programs for, 208-210 risk pool management for, 74 role of, in health care reform, 20, 250-251 self-insurance and, 218 see also Costs of health care; Utilization management Cost sharing, 74, 103-106 definition of, 336 effect on cost of care, 217 income-adjusted, 181 n.7 Cost shifting definition of, 336 employer concerns about, 232 government role in. 211-212 recommendations for controlling, 248 uncompensated care and, 21, 184, 252

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Employment and Health Benefits: A Connection at Risk Costs of health care administrative expenses in, 108-110, 151, 206, 240 caps on enrollee spending, 104 concept of value in, 203-204, 223-227 consumer concerns about, 202 consumer spending on, 4, 204 distribution of spending on, 3, 4, 5, 27-28, 167 in early insurance plans, 67-68 economic effects of, 202-203 employer spending on, 4, 27-28, 71 n.17, 207 factors in rise of, 4, 7, 202-204, 221 growth of, 4, 28-29, 61, 78, 108, 204-207 individual's health status affecting, 178-179 inflation as factor in, 204 inpatient vs. outpatient services in, 204 international comparisons of, 4-5, 29-30 market forces in, 220-223 medical care component of, 204-205 medical technology in, 203, 204-206, 224 as obstacle to small group benefit plans, 94 population growth as factor in, 204 premium costs in, 106-108 public program spending on, 5, 207, 274 public subsidy of, 18-19, 248 reform and, 20, 248, 250-251 risk selection and, 183-184 size of group and, 183 tax expenditures in, 110 trends in, 204-206 uncompensated care in, 184, 252 in workers' compensation programs, 115 see also Cost management Council of Smaller Enterprises, 127 Coverage continuity of, 10-11, 85, 239, 259, 313-314 direct employer, 90, 337 indirect employer, 90, 338 issues in legislative reform, 256 mandated continuity of, 313-314 state-mandated, 298 state regulation of, 296-297, 298 vs. access, 7, 234 see also Benefit design D Deductibles, 103-104, 336 Demographic risk adjustment, 196-197 Dental benefits, 102 Department of Health and Human Services, 88, 89 Department of Labor, Bureau of Labor Statistics, 88-89 Diagnosis-related groups, 197, 211, 336 Disability insurance, 43 n.8 in origins of medical insurance, 51-54 Discrimination age, protection against, 316 health related, 117-118, 148, 185-187, 236-237 in workplace health promotion programs, 118-119 E Economic Stabilization Program, 208 Elderly employment-based insurance for, 90 private insurance for, 77 Eligibility defining family members for, 89-90 n.5 state-mandated, 101 workplace rules, 93-94 Employee advisory groups, in case study, 135-137 Employee assistance programs, 24, 118-119, 258-259, 337 Employee Benefit Research Institute, 31, 88 survey, 148-149, 287-292

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Employment and Health Benefits: A Connection at Risk Employee Retirement Income Security Act of 1974 (ERISA), 82-85, 231-232, 293, 300-313 deemer clause of, 310 definitions in, 302, 304 employer liability for managed care and, 152-153 federal legal supplements to, 315-317 fiduciary standards in, 304-306 government regulation before, 82 multiple employer welfare arrangements and, 315 preemption of state law by, 306-311 recommendations for amending, 16, 19, 249-250 regulation of self-funded plans under, 310-313 reporting requirements of, 303-304 savings clause of, 307-310 underwriting in, 182 vesting in, 302-303 Employment-based health coverage case study of, 128-145 costs of, 106-111 defining, 40-41, 44 development of, 3, 27, 49-56, 65-71, 67-71 employee responsibilities in, 145-149 in health care reform, 23-24, 26-27, 36, 207, 230-231, 242-243, 260-261 management activities in, 5-6, 121-127, 149-152, 232 mandated, 21-23, 251-254 participation in, 5-6, 8-9, 26, 27-28, 89-98, 232-233 private initiatives to control costs in, 212-220 types of, 98-106, 114-119 Employment practices discontinuity in benefit coverage, 10-11, 239 effect of Americans with Disabilities Act on, 185-187 encouraging enrollment in spouse's benefit plan, 92 hiring of smokers, 117-118 n.16, 186 medical screening in hiring, 9, 117-118 ERISA. See Employee Retirement Income Security Act of 1974 European experience, see International comparisons Experience rating, 47, 112-113, 133, 197, 337 F Families deductibles in coverage for, 103 of insured workers, benefits for, 89-92 of uninsured workers, 92-94 Federal Employees Health Benefits Program features of, 170, 175 origins of, 73 risk selection in, 175-177 Federal regulation in development of employment-based health plans, 70-71 early social insurance proposals, 60-65 encouraging HMOs, 210 before ERISA, 82, 300 of mental health benefits, 106 n.11 need for, 19, 245-246, 248-250, 251-254 of pre-employment medical screening, 9 see also Employee Retirement Income Security Act of 1974 (ERISA); State regulation Fee-for-service plans definition of, 337 modified, in network plans, 100 Fiduciary definition of, 337 standards in ERISA, 304-306

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Employment and Health Benefits: A Connection at Risk Financial Accounting Standards Board, 95 Financial management ERISA requirements, 84 evaluating benefit options, in case study, 133 retiree benefits as corporate liabilities, 95, 113-114 tax expenditures in health benefits, 110-111 Flexible benefits, 119, 218, 337 Foundations for medical care, 76 France, health care spending in, 30, 32 Fraud, 116 G Gatekeeper physician, 100, 338 Gender, premiums related to, 173 Geographic variations in coverage, 98, 101 Germany, 36-37 n.3 development of medical insurance in, 53 health care spending in, 30, 32t premium costs in, 106 risk segmentation in, 46 n.9, 168 n.2 role of employers in, 217 n.5 sickness funds of, 46 n.9, 56, 57 social insurance in, 41 n.6, 42, 57 Group Health Association, 69 Group practice origins of, 66, 69 prepaid, 341 H Hawaii, 37, 83, 108, 219, 307 Health Care Financing Administration, 88, 89 Health Insurance Association of America, 88, 89, 188 n.13 Health Maintenance Organization Act of 1973, 82 Health maintenance organizations benefit coverage in, 102 definition of, 338 evaluating, in case study, 130, 132-135 evidence of cost savings in, 218 government encouragement of, 210 group model, 338 growth of, 100 Medicare-contracted, 197 numbers of, 126 open-ended, 340 relative restrictiveness of, 98 risk selection in, 174, 177-178, 179 staff model, 344 state regulation of, 298-299 Health planning, 75-76, 208-209 Health Planning and Resources Development Act of 1974, 209 Healthy People 2000, 116 Heritage Foundation, 37 High-risk individuals, 117-118, 171-172, 199-200 Historical developments, 3, 27 Blue Cross plan, 66-69 in cost management, 73-77 early social insurance proposals, 57-65 government efforts to control health care costs, 207-212 growth of cost of care, 78 key dates of, 52 origins of employment-based health plans, 69, 70-72 origins of medical insurance, 51-56 private insurance initiatives, 65-71 in regulation of insurance, 293-295 in social insurance, 56-57 in utilization review, 76-77 Hospice care, 102 Hospitals administrative expenses in, 110 cost of uncompensated care in, 184, 252 cost shifting in, 211-212 development of, 53 government cost control programs in, 208-210 prospective payment system in, 211 resource management of, 75-76

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Employment and Health Benefits: A Connection at Risk I Indemnity insurance, 98-99, 338 evaluating, in case study, 132-133 Independent practice associations, 126, 338 employee concerns about, in case study, 135-136 evaluating, in case study, 130, 132 evidence of cost savings in, 218 origins of, 75 relative restrictiveness of, 98 risk selection in, 174 Information management under Americans with Disabilities Act, 185-186 analyzing health care data, 88 in establishing health status measures, 198-199, 225 evaluating benefit plans, case study of, 131-133 in risk-adjustment methodologies, 18, 197-198 see also Confidentiality Innovation in benefit plan design, 10, 24, 238-239 by commercial insurers, 71-72 in health research, 238 in medical technology, 10, 31, 50 in state regulatory efforts, 249-250 Insurable event, 44-45, 338 Insurance actuarial fairness in, 180 administrative costs of, 109-110 administrative practices, regulation of, 296 basis for state regulation of, 293-295 definition of, 43, 338 disability, defining, 43 n.8 ERISA preemption and state regulation of, 308-310 growth of, 71-72 indemnity, 98-99 insurable event in, 44-45, 338 language of, 40-47 moral hazard in, 45-47 origins of, 51-56 prepayment, definition of, 44 private, enrollment in, 90 rate regulation of, 296-297 social, 41-42, 56-57, 58-60, 60-65, 181, 344 unfair practices in, 297-298 Insured workers, 89-92 concerns of, in benefit plan, 145-149 employee advisory group, in case study, 135-137 full-year, full-time, 92-93, 337 full-year, part-time, 337-338 health care spending by, 106 International comparisons defining employment-based systems in, 36 early medical insurance in, 51-56 in health care reform, 36-37 in health care spending, 4-5, 29-34, 239-240 universal coverage, 56-57, 236 see also specific country J Japan, health care spending in, 30, 33 Job "lock," 32, 239 K Kaiser plan origins of, 69 underwriting in, 127 n.2, 219 L Labor Management Relations Act of 1947, 300 Legal issues in authority of ERISA, 301 employer liability for managed care, 152-153 federal preemption of state laws by ERISA, 306-311

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Employment and Health Benefits: A Connection at Risk fiduciary standards in ERISA, 304-306 foundations of state insurance regulation, 294-295 in multiple employer welfare arrangements, 314-315 in review of benefit plan options, in case study, 134 unfair insurance practices, state regulation of, 297-298 Lifestyle factors, 180, 186-187 Loading factor, 339 Louisiana, 108 Low-wage workers extent of coverage for, 92-93 subsidized coverage, 248, 251 tax deductions for health care for, 111 M Managed care, 100, 339 Managed competition, 190-194 Managed coverage, see Compulsory coverage in social insurance Marketing practices, risk selection through, 175 Maryland, 209 Massachusetts, 108 McCarran-Ferguson Act, 82, 295, 309 Medicaid, 2, 42, 79-80, 339 administrative expenses, 108, 110 cost shifting and, 212 Oregon plan for restructuring, 193 Medical organizations early opposition to health plans by, 69-70 see also American Medical Association Medical records, see Information management Medical services in cost of care, 204-206, 223-226 regulation of, 75-77, 208-211 Medical technology assessing value of, 225-226 cost of care and, 203, 205-206, 218, 224 development of, 51-53 innovation in benefit design and, 10, 31, 50 Medicare prospective payments and, 211 risk assessment methodologies and, 195-196 role in cost of health care, 205-206 Medicare, 2, 12, 78-79, 208-209, 339 administrative expenses, 108, 110 enrollment history, 79 HMOs in, 20 integrating retiree employment-related coverage with, 94-95 n.6 pharmacy benefits in, 102 prospective payment system in, 211, 212 risk assessment in, 195-196 secondary payers in, 316 use of utilization measures in, 197 Mental health care cost of, as percentage of health expenditures, 104-106 coverage limits on, 104-106 employee assistance programs for, 118-119 Mississippi, 108 Moral hazard, 45-47, 339 Multiemployer plans, 85, 339 Multiple employer welfare associations, 84, 314-315, 339 N National Association of Insurance Commissioners, 82, 188 n.13, 295 National Conference on Medical Costs, 212 National Labor Relations Board, 70-71 National Medical (Care) Expenditures Survey, 92 Netherlands, 106, 145-146 Network health plans coinsurance in, 103-104 definition of, 340

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Employment and Health Benefits: A Connection at Risk effect on cost of care by, 217-218 risk selection in, 174 state regulation of, 298-299 types of, 100-101 Norway, health care spending in, 30 O Oregon, 19, 193 n.15 P Part-time workers, 90, 337-338 Peer review, 76 Peer review organizations, 210-211 Pepper Commission, 37 Pharmacy benefits, 102, 147 n.4 Physician(s) early opposition to health insurance, 55 as gatekeepers, 100 impact of employment-based benefits on, 149-152 importance of, in consumer choice, 170 in Medicare program, 78-79 payment, 211 primary care, 341 risk selection in restricted network of, 174 role of, 53 types of, in state-mandated benefits, 101 Point-of-service plans definition of, 341 features of, 191 growth of, 100 relative restrictiveness of, 98 Preadmission review, 341 Preferred provider organizations, 218, 341 coinsurance in, 104 relative restrictiveness of, 98 risk selection in, 174 state regulation of, 298-299 Premiums age related to, 173 considerations in regulating, 255 cost of, 106-108 definition of, 341 effect of risk selection on, 175-176 evaluating benefit plan options, in case study, 133 gender related to, 173 risk rating of individuals and cost of, 117 for self-insured groups, 112, 113 workers' compensation, 115 Private insurance, enrollment in, 90 Professional standards review organizations, 210 Prospective Payment Assessment Commission, 212 Prospective payment system cost shifting and, 211-212 definition of, 342 effect of, 211 origins of, 211 Public opinion on administration of health care system, 232 compulsory employment-related coverage in, 31 cost concerns in, 202 delivery of health care in, 1-2, 22-23, 31 Employee Benefit Research Institute survey on, 148-149, 287-292 of health benefits system, 12-13 Public spending early social insurance proposals, 57-65, 60-65 financing through reform, 20, 248 international comparisons, 4-5, 32-33, 56-57 for Medicaid, 80 need for, 18-19, 248 public understanding of, 202 in risk-adjusted payment plans, 17-18 statistics, 4, 27 Purchasing cooperatives, see Cooperatives

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Employment and Health Benefits: A Connection at Risk Q Quality assurance, 342 Quality of care, 342 definition of, 184 effect of risk selection on, 184-185 health care spending and, 33 n.2 for the uninsured, 21, 252 R Redlining, 97-98 Reform of health care system administrative issues in, 151-152 alternatives proposed for, 37-38 amending ERISA in, 16, 19, 248-250 American Medical Association stance on, 59 n.8 basic benefit design in, 19-20, 193, 249, 258 confidentiality issues in, 16-17 continuity of care in, 259 cooperatives in, 18, 247-248 cost of, 250-251 employee assistance programs in, 258-259 employer size and, 219-220 high risk individuals in, 199-200 impact of private cost control strategies, 216-220 issues in, 1-3, 35-40, 48, 50, 254-256 managing competition in, 190-194 mandated universal coverage in, 21-23, 251-254 market-oriented approaches to, 7, 22, 207, 220-223, 240 mental health care in, 106 n.11 need for, 1, 14, 17, 47-48, 260 pace of, 227-228 proposals in other countries, 36-37 public subsidy of, 18-19, 248 to reduce risk selection, 14-17, 175-176, 187, 242 research needs for, 256-259 risk-adjusted payments in, 17-18, 194-196, 247, 257 risk sharing and, 261 role of employer in, 14, 22, 23-24, 31, 36, 216-220, 230-231, 242-243, 260-261 role of private sector in, 227-228, 229-230, 260-261 state experimentation in, 249-250 underwriting practices in, 16, 47, 187-190, 245-246, 257 within voluntary system, 243 workers' compensation system in, 115-116 Reimbursement systems cost shifting and, 211-212 development of, 75 evaluation of, in case study, 133 in Medicare program, 79 in network plans, 100 physician, 211 prospective payment, 211 resource-based relative value scale, 211 Reinsurance, 199-200, 342 Request for proposals, in case study, 137-139, 155-166 Research needs basic benefit design, 19-20, 258 on continuity of care, 259 employee assistance programs, effects of, 258-259 for health care reform, 23, 256-259 methodologies for risk adjusting, 18, 257 technology assessment, 226-227 underwriting reforms, consequences of, 257 Resource-based relative value scale, 68, 211 Responsible National Health Insurance plan, 37 Retirees, 94-95 benefits for, as corporate liability, 95, 113-114 Retrospective payment, 342 Risk, definition of, 43, 343

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Employment and Health Benefits: A Connection at Risk Risk-adjusted payments, 17-18, 194-196, 247, 343 demographic approach to, 196-197 health status measures in, 198-199 methodologies for, 196-199, 257 prior use data for, 197-198 Risk pools, see Risk sharing Risk rating, 47, 117, 343 Risk segmentation arguments for, 13, 242 causes of, 47, 168 definition of, 46-47, 343 strategies for reducing, 187, 245-246 Risk selection, 167-169, 200-201 benefit design affecting, 171-174 biased, 46, 167, 335 causes of, 170-175, 178-179 definition of, 46, 168 discrimination and, 9, 236-237 in early insurance plans, 67, 69 effect of Americans with Disabilities Act, 185-187 effect on access, 182-183 effect on costs of care, 183-184 effect on premiums, 175-176 effect on quality of care, 184-185 employer factors contributing to, 170-172 equity issues in, 179-182 evidence of, 177-179 in Federal Employees Health Benefits Program, 175-177 high risk individuals and, 199-200 moral hazard and, 46 in network plans, 174 regulating competition to discourage, 190-194 risk-adjusted payments to reduce, 17-18, 194-196 size of group and, 168 strategies for reducing, 14-16, 187, 245 through administrative practices, 174-175 through individual medical records, 16-17 through marketing practices, 175 underwriting practices and, 173, 187-190, 245-246 universal coverage and, 22, 252 Risk sharing definition of, 343 importance of, 26 risk pools for, 43, 74-76, 199-200, 343 Rochester, New York, 113, 127, 181 n.8, 218-219 S Second opinion, 76, 343 Self-insured groups, 343 advantages of, 111-112 in case study, 133 cost savings by, 218 ERISA regulation of, 83-85, 310-313 funding mechanisms for, 111 liability for managed care in, 153 medical underwriting within, 16 premiums for, 112, 113 related to employer size, 111 risk segmentation and, 47, 168 risk-sharing arrangements for, 112-113 state regulation of, 101, 250, 310-313 stop-loss insurance for, 113 taxing of, 248 trends in, 189 types of, 44 Size of employer administration of health plan and, 110, 121-122, 124-126 benefit design and, 5-6, 9-10, 99 cost containment strategies related to, 214 costs of health care and, 106, 183, 237 coverage availability related to, 5, 96-97, 232-233 employee assistance programs, 118

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Employment and Health Benefits: A Connection at Risk employer-financed coverage for retirees and, 95 evaluating benefit plans and, in case studies, 142-145 flexible benefit plans and, 119 health care reform and, 16, 219-220 health promotion programs and, 5-6, 117 risk selection and, 16, 168 self-insurance practices and, 16, 111 underwriting and, 16, 245-246 Small businesses cooperative efforts by, 18, 127, 214-215, 247-248 definition of, 5, 42-43 HMO offerings by, 99, 214 limiting underwriting practices in, 187-190 reasons for not offering health benefits in, 94 see also Size of employer Smokers, hiring of, 117-118 n.16, 186 Social insurance definition of, 41-42, 344 development of, 56-57 early proposals for, 58-65 in Germany, 41 n.6, 42, 59 theoretical basis of, 181 Social Security Act, 64, 78, 80 Amendments of 1972, 208-209 Societe Francaise de Bienfaisance Mutuelle, 53 State regulation benefits mandated by, 19-20, 101, 249, 298 ERISA and, 82-85, 249-250, 306-313 experimentation in, 249-250 extent of, 293 of insurance company management, 296 of insurance rates, 296-297 limiting risk selection through, 181-182 of managed care organizations, 298-299 of Medicare, 79-80 of multiple employer welfare arrangements, 315 origins of, in health care, 293-295 of self-insured groups, 310-313 social insurance initiatives, 58-60 of unfair insurance practices, 297-298 Statistics administrative expenses, 108-110 benefit design, 102 coinsurance arrangements, 104 in Committee on the Costs of Health Care report (1928-1932), 60-61 consumer concerns about cost of care, 202 cost of mental health care, 104-106 coverage related to size of company, 96, 99 data sources for, 88-89 deductibles, 103 employment-based plans, enrollment in, 1, 27, 71, 236 flexible benefit plans, 119 health care in Rochester, New York, 219 health care spending, 3, 4, 27-28, 78, 204-206, 207 HMO enrollment, 210 industry type as variable in coverage availability, 97 insured populations, 3, 26, 27, 28, 236 insured workers, 89-92 Medicaid, 80 Medicare, 79, 236 network plan enrollments, 100 premium costs, 106-108 publicly funded health coverage, 4, 27 regional variation in coverage availability, 98, 99 retirees, 94-95 self-insured groups, 111 taxation of health benefit expenditures, 110-111 types of plans offered, 99 uninsured populations, 1, 4, 27, 236

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Employment and Health Benefits: A Connection at Risk uninsured workers, 92-94 worker attitudes toward benefit plans, 148-149, 287-292 workers' compensation benefits, 115 Steelman Commission, 37 Stop-loss coverage definition of, 113, 344 extent of, in self-insured groups, 111 for self-insured groups, 113 types of, 113 Switzerland, 42 T Taft-Hartley Act of 1947, 70 Tax Equity and Fiscal Responsibility Act of 1982, 85 Taxes, 110-111 deductibility of contributions to health plans, 71, 110-111 flexible benefit packages and, 119 legal supplements to ERISA, 315 in market-based reforms, 222 retiree health benefits as corporate liabilities, 95, 113-114 for self-insured groups, 248 Technology. See Medical technology Terminating benefits, ERISA provisions on, 84 Third-party administrators, 113, 126, 152-153, 344 Traveler's Insurance Company, 55 n.4 Triple-option plan, 344 Trusts, for self-insurers, 113, 344 U U.S. Chamber of Commerce, 37 U.S. Public Health Service, origins of, 57 Uncompensated care, 21, 184, 252, 344 Underwriting in Americans with Disabilities Act, 185, 186 in cooperative plans, 127 n.2 by Council of Smaller Enterprises, 127 definition of, 344 risk selection and, 173, 182, 187-190, 245-246 role of, 47 in small-group market, 16 strategies for limiting, 16, 181-182, 187-190, 245-246, 251-252, 255, 257 Uninsured populations age of, 93 health care for, 21, 234, 252 health of, 183 statistics, 1, 4, 27, 236 workers as, 8-9, 87, 92-94 working, vs. nonworking, in generating uncompensated care, 184 n.9 Unions in development of employment-based health plans, 70-71 in development of medical insurance, 54, 55, 76 United Kingdom health care spending in, 30, 33 origins of medical insurance in, 51, 55-56 Universal coverage, 236 employment-based, 21-23, 251-254 lack of, 22-23, 254 need for, 21, 251-252 Utilization management definition of, 344 effect of, on cost of care, 217 employer liability for managed care and, 152-153 extent of, in employer benefit plans, 213-214 as measure in risk-adjusting, 197-198 in Medicare, 208 origins of, 76-77 retrospective, 342 V Voluntary employee beneficiary association, 113

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Employment and Health Benefits: A Connection at Risk Voluntary system of coverage, 1, 8, 26, 235, 237 early history, 51-56 improving, 243-251 limitations of, 21, 251-252 marketplace effects of, 9-10 replacing, 251-254 W Welfare capitalism, 54 Well baby care, 102 Wellness programs, 116-119, 218 Workers' compensation, 114, 115-116, 345