Jessica Vistnes

Race/ethnicity and health insurance status: 1987 and 1996.

Health insurance confers important private and social benefits. Disparities in coverage among the population remain an important public policy issue. The authors focus on the health insurance status of white, black, and Hispanic Americans in both 1987 and 1996 and identify gaps in minority health care coverage relative to white Americans. They also investigate the access of workers in these groups to employment-based health insurance. Identified are factors underlying changes in the insurance status of workers during the past decade in terms of changes in population characteristics and structural shifts underlying the demand for and supply of health insurance. The authors find that while coverage has declined for workers in most racial/ethnic groups, the experience of Hispanic males appears to be unique in that changes in their characteristics as well as structural shifts account for their decline in employment-related coverage. Structural shifts dominated the changes in coverage rates for other groups.

Health Insurance Availability at the Workplace: How Important are Worker Preferences?

Analysts have frequently interpreted the uneven distribution of health insurance across firms of varying size as evidence of insurance market failure in the small group market. We explore an additional explanation by considering the relationship between employee preferences for health insurance and its availability at the workplace. We apply a simple model of job choice to data from the 1987 National Medical Expenditure Survey to examine whether workers with weak preferences for health insurance sort themselves into jobs without coverage. Our results for a sample of single workers are consistent with such sorting behavior.

Who belongs to HMOs: a comparison of fee-for-service versus HMO enrollees.

As employers have turned to managed care to curtail the rising cost of health care benefits, the number of HMO enrollees has proliferated. Between 1984 and 1994, HMO enrollment incrased from approximately 15 million to over 49 million individuals. Although research has indicated that HMOs have been effective in limiting medical costs, there is mixed evidence in the literature on how they achieve these savings. This article uses data from the 1987 National Medical Expenditure Survey to examine one hypothesis for these patterns: that HMOs enroll a healthier population than fee-for-service plans. To test this hypothesis we examine HMO andjee-for-evice enrollees with respect to sxioeconomic variables such as age, race, sex, income, education, health status, and location. Our results indicate that HMOs tend to enroll a younger but not much healthier population than traditional fee-for-service plans, suggesting that self-selection is not a major contriutor to HMO cost savings.

The Effect of SCHIP Expansions on Health Insurance Decisions by Employers

This study uses repeated cross-sectional data from the Medical Expenditure Panel Survey—Insurance Component (MEPS-IC), a large nationally representative survey of establishments, to investigate the effect of the State Childrens Health Insurance Program (SCHIP) on health insurance decisions by employers. The data span the years 1997 to 2001, the period when states were implementing SCHIP. We exploit cross-state variation in the timing of SCHIP implementation and the extent to which the program increased eligibility for public insurance. We find evidence suggesting that employers whose workers were likely to have been affected by these expansions reacted by raising employee contributions for family coverage options, and that take-up of any coverage, generally, and family coverage, specifically, dropped in these establishments. We find no evidence that employers stopped offering single or family coverage outright.

Declines in employer-sponsored insurance between 2000 and 2008: examining the components of coverage by firm size.

OBJECTIVE To examine trends in employer-sponsored health insurance coverage rates and its associated components between 2000 and 2008, to provide a baseline for later evaluations of the Affordable Care Act, and to provide information to policy makers as they design the implementation details of the law. DATA SOURCES Private sector employer data from the 2000, 2001, and 2008 Medical Expenditure Panel Survey-Insurance Component (MEPS-IC). STUDY DESIGN We examine time trends in employer offer, eligibility, and take-up rates. We add a new dimension to the literature by examining dependent coverage and decomposing its trends. We investigate heterogeneity in trends by firm size. DATA COLLECTION The MEPS-IC is an annual survey, sponsored by the Agency for Healthcare Research and Quality and conducted by the U.S. Census Bureau. The MEPS-IC obtains information on establishment characteristics, whether an establishment offers health insurance, and details on up to four plans. PRINCIPAL FINDINGS We find that coverage rates for workers declined in both small and large firms. In small firms, coverage declined due to a drop in both offer and take-up rates. In the largest firms, offer rates were stable and the decline was due to falling take-up rates. In addition, enrollment shifted toward single coverage and away from dependent coverage in both small and large firms. For small firms, this shift was due to declining offer and take-up rates for dependent coverage. In large firms, offers of dependent coverage were stable but take-up rates dropped. Within the category of dependent coverage, the availability of employee-plus-one plans increased in all firm size categories, but take-up rates for these plans declined in small firms.

Employer Contribution Methods and Health Insurance Premiums: Does Managed Competition Work?

We derive a two-stage model in which health plans first compete to be selected by employers and subsequently compete to be chosen by employees. We identify the key determinants of competition and show that increasing competition at one stage often comes at the expense of competition at the other stage. Many economists and policymakers have argued that in order to increase competition among health plans, employers should offer multiple plans and structure premium contributions to make employees more price sensitive. While our theoretical model shows that following this policy prescription may not actually lead to lower premiums, our empirical analysis provides some support for this recommendation. We also find that if employers instead pay the full premium, premiums increase when they offer additional plans. These results have important implications for both employers and policymakers.

A closer look at the managed care backlash

Background:Much anecdotal evidence exists regarding the managed care backlash of the late 1990s, but limited empirical evidence is available. Objectives:Using a unique series of employer surveys, we examined trends in enrollment rates in health maintenance organizations (HMOs) and other plan types between 1997 and 2003. Research Design:We present enrollment rates in employer-sponsored health plans by plan type. These plan-level enrollment rates are disaggregated by whether or not enrollees had a choice of plan types and by firm size and year. Subjects:Employees who were enrolled in employer-sponsored health insurance in private sector establishments. Results and Conclusions:Although we found evidence of a decline in the popularity of HMOs, it occurred later than indicated in earlier studies. In our data, HMO enrollment rates fell from roughly 32% to 26% between 1997 and 2003, with most of the decline occurring after 2001. Earlier studies reported that the decline in HMO enrollment rates occurred between 1996 and 1998, and between 2000 and 2001. In addition, an interesting story emerged when we examined trends by firm size. We found evidence of a decline in the HMO enrollment rate for large employers starting in 1998. However, this was offset by an increase in the HMO enrollment rate in small employers, which explains the stability in our figures before 2002. Our data also indicated that when workers were given a choice between an HMO and other plan types, workers increasingly opted for the non-HMO plan during this time period.

Employer choices of family premium sharing

In 1997, nearly two-thirds of married couples with children under age 18 were dual-earner couples. Such families may have a variety of insurance options available to them. If so, declining a high employee premium contribution may be a mechanism for one spouse to take money wages in lieu of coverage while the other spouse takes coverage rather than high wages. Employers may use these preferences and the size of premium contributions to encourage workers to obtain family coverage through their spouse. The purpose of this paper is to explore the effects of labor force composition, particularly the proportion of dual-earner couples in the labor market, on the marginal employee premium contribution (marginal EPC) for family coverage. We analyze data from the 1997–2001 Medical Expenditure Panel Survey— Insurance Component (MEPS-IC) List Sample of private establishments. We find strong evidence that the marginal EPC for family coverage is higher when there is a larger concentration of women in the workforce, but only in markets with a higher proportion of dual-earner households.

Premium growth and its effect on employer-sponsored insurance

We use variation in premium inflation and general inflation across geographic areas to identify the effects of downward nominal wage rigidity on employers’ health insurance decisions. Using employer level data from the 2000 to 2005 Medical Expenditure Panel Survey-Insurance Component, we examine the effect of premium growth on the likelihood that an employer offers insurance, eligibility rates among employees, continuous measures of employee premium contributions for both single and family coverage, and deductibles. We find that small, low-wage employers are less likely to offer health insurance in response to increased premium inflation, and if they do offer coverage they increase employee contributions and deductible levels. In contrast, larger, low-wage employers maintain their offers of coverage, but reduce eligibility for such coverage. They also increase employee contributions for single and family coverage, but not deductibles. Among high-wage employers, all but the largest increase deductibles in response to cost pressures.

The health insurance status of low-wage workers: the role of workplace composition and marital status.

Many of the provisions in the Affordable Care Act (ACA), such as tax credits and penalties for employers, vary by employer size and average wage level. Therefore, knowing the wage and firm size distribution of low-wage workers and how employer-sponsored insurance (ESI) characteristics vary by these dimensions is particularly important for understanding the extent to which low-wage workers and their employers may be affected by different provisions in the ACA. To inform this issue, the authors use data from the 2006 Medical Expenditure Panel Survey—Insurance Component to examine offers of coverage and cost-sharing requirements by the wage distribution and firm size dimensions of employers. They also draw on Medical Expenditure Panel Survey household-level data to describe the household circumstances of low-wage workers. The authors find that where low-wage workers are employed, who their colleagues are, and their spouses’ wage levels are important factors in determining low-wage workers’ access to coverage and the cost and generosity of such coverage.