PAUL FRONSTIN, Employee Benefit Research Institute (EBRI)
Email: FRONSTIN@EBRI.ORG

This paper presents findings from the 2008 EBRI/MGA Consumer Engagement in Health Care Survey, focusing on public opinion regarding variation in cost sharing as it relates to consumer engagement in health care. Overall, 58 percent of individuals support lower cost sharing for patients who are actively participating in a program to maintain or improve their health; 40 percent support lower cost sharing for patients who use treatments that have been scientifically proven to be effective for their medical condition; 34 percent support lower cost sharing for patients who choose to see high-performing health care providers; 47 percent support lower cost sharing for patients who choose less invasive procedures to treat their medical conditions; and 58 percent support lower cost sharing for patients who carefully follow their treatment regimens. Between 13 and 25 percent disagreed with the use of lower cost sharing, while 28-40 percent neither supported nor opposed it. The paper also examines how the support for lower cost sharing related to patient engagement varies by health status and behaviors, demographics, and work status variables.

Employers and insurers are going to continue experimenting with various ways in which they can use features of their benefits plan to increasingly engage workers and their families in their health care in order to manage health care costs more effectively. They will find that some things work while others do not. The support for consumer engagement initiatives will vary across employees and may ultimately affect the success of specific programs.

The PDF for the above title, published in the May 2009 issue of EBRI Notes, also contains the fulltext of another May 2009 EBRI Notes article abstracted on SSRN: ?Income of the Elderly Population Age 65 and Over, 2007.?

ALEXANDER M. GELBER, Harvard University, National Bureau of Economic Research
Email: gelber@gmail.com

Background: Policymakers have recently proposed ways of providing health care coverage for an increased number of uninsured persons. However, there are few data that show how the incidence and duration of periods in which persons do not have insurance have changed over time.

Methods: We used two data sets from the Survey of Income and Program Participation of the U.S. Census Bureau: one that covered the period from 1983 through 1986 (25,946 persons), and another that covered the period from 2001 through 2004 (40,282 persons). For each set of years, we estimated the probability that a person would be uninsured for some period of time and the probability that a person would subsequently obtain private or public insurance. We also estimated the probabilities that persons in various demographic groups would become uninsured over the course of a year and would remain uninsured for various amounts of time.

Results: The percentage of the population that lost insurance in a 12-month period increased from 19.8% in 1983?1986 to 21.8% in 2001?2004 (P=0.04). The percentage that was uninsured for a period of time increased markedly among persons with the lowest educational level and predominantly represented loss of private coverage. The percentage of new uninsured periods that ended within 24 months increased from 73.8% to 79.7% between the two study periods (P<0.001); increases were seen in all age groups and among persons of all educational levels. Transition from no insurance to private insurance decreased from 65.2% to 59.2% (P<0.001). Transition from no insurance to public insurance increased from 8.7% to 20.4% (P<0.001).

Conclusions: As compared with the years from 1983 through 1986, from 2001 through 2004, more people, particularly those with the lowest educational level, had periods in which they were not insured. The periods without insurance were shorter in 2001?2004 than they were in 1983?1986, since an increase in transitions to public coverage offset a reduction in transitions to private coverage. Our results portend difficulties if private coverage continues to decline and is not offset by further expansions of public insurance.

MICHAEL K. MCSHANE, Old Dominion University
Email: mmcshane@odu.edu
LARRY A. COX, Southern Illinois University at Edwardsville - Department of Economics & Finance
Email: lcox@bus.olemiss.edu

Increasing costs of long-term care are placing ever greater burdens on state and federal budgets, yet private long-term care insurance remains a relatively minor financing vehicle. Although many researchers provide rationales for the limited private market, some life?health insurers have forged ahead into this relatively new and risky line of business. We investigate what makes these insurers different and whether managers are following a diversification or strategic focus strategy. We find that strategic focus is a consistently important factor and that managers' participation and volume decisions are made independently.

ROBERT W. FAIRLIE, University of California, Institute for the Study of Labor (IZA), RAND Corporation
Email: rfairlie@ucsc.edu
REBECCA A. LONDON, Stanford University
Email: rlondon@stanford.edu

In this study, we examine annual transitions into and out of health insurance coverage using matched data from the 1996 to 2004 Current Population Survey (CPS). We find evidence of several characteristics that are strongly associated with the likelihood of losing or gaining health insurance including race, education, unemployment, part-time employment status, employment size, and self-employment.

KATHLEEN J. MULLEN, RAND Corporation
Email: kmullen@rand.org
RICHARD G. FRANK, Harvard Medical School, National Bureau of Economic Research (NBER)
Email: frank@hcp.med.harvard.edu
MEREDITH B. ROSENTHAL, Harvard University - Harvard School of Public Health
Email: mrosenth@hsph.harvard.edu

Despite the popularity of pay-for-performance (P4P) among health policymakers and private insurers as a tool for improving quality of care, there is little empirical basis for its effectiveness. The authors use data from published performance reports of physician medical groups contracting with a large network HMO to compare clinical quality before and after the implementation of P4P, relative to a control group. They consider the effect of P4P on both rewarded and unrewarded dimensions of quality. In the end, they fail to find evidence that a large P4P initiative either resulted in major improvement in quality or notable disruption in care.

JOHN A. MACDONALD, Employee Benefit Research Institute (EBRI)
Email: macdonald@ebri.org

This paper summarizes highlights from the Employee Benefit Research Institute's (EBRI) December 2008 policy forum, titled "Outlook for Consumer/Patient Engagement in Health Care--30 Years into the Experiment," which took a detailed look at consumer-directed health plans and related issues. Policy forum participants heard two very different presentations on the prospects for consumer-directed plans. One speaker was optimistic, saying consumer-directed plans have worked because individuals in these plans have substituted less expensive care for more expensive care in order to minimize their out-of-pocket costs. Another speaker was skeptical, saying consumerism will have a "marginal impact" but will not solve the problem of rising health care costs. Two speakers discussed value-based insurance design in which employers attempt to tailor their health plans to balance the demonstrated value of a service against its cost. Value-based design encourages consumers to use health services when the clinical benefits exceed the cost and at the same time discourages the use of services when the benefits do not justify the cost. Value-based design seeks to influence consumer behavior by linking co-payments to the use of a clinically demonstrated benefit, while consumer-driven health plans use tax-sheltered accounts for much the same purpose. Value-based design is still relatively limited in use, shows some cost-saving potential, but questions about the concept remain, the speakers said.

DAVID P. BERNSTEIN, affiliation not provided to SSRN
Email: spstat@yahoo.com

Abstract: This paper examines issues with the use of reinsurance programs to expand health insurance coverage to younger adults, older adults, and households that have a member with a pre-existing condition. Reinsurance programs could reduce insurance company losses and risk in the small-group and non-group markets. However, even with reinsurance specific cohorts will still have a difficult time obtaining affordable health insurance. Reinsurance could be part of a health care reform package of the multi-payer insurance system but an effective reform would have to include incentives or mandates spurring coverage by younger healthier adults and guaranteeing affordable access regardless of age or health status.