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Results for “Insurance Selection Bias”

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At least 19 recordsLinked to original sources
PubMed1991

A method for risk-adjusting employer contributions to competing health insurance plans.

Biased selection can threaten the viability of multiple choice health systems unless payments to particular plans are adjusted to offset risk differences among employees. We report the results of a study designed to predict medical care utilization and expenditures for groups of fee-for-service plan (FFS) and health maintenance organization (HMO) enrollees, using characteristics commonly available in the personnel files of large employers. Simulation analyses indicate that the six-equation, maximum likelihood model predicts well for groups of 1,000 or more. Additional data are required to reduce prediction errors for smaller groups. This new methodology potentially allows risk-rating of employer contributions to competing health plans, based on the expected utilization of the individuals choosing each plan.

Economic Competition↗
PubMed1994

Genetic testing: an economic and contractarian analysis.

Medical researchers are rapidly identifying the genetic causes of many diseases. Genes that increase the risk of contracting Alzheimer's, colon and breast cancer, Huntington's, cystic fibrosis and numerous other diseases have been identified. Genetic tests can reveal an individual's probable health status many years in advance of sickness. Many fear that this will lead to 'genetic discrimination' in the employment and health insurance markets. Solutions such as consent laws are impractical and create adverse selection problems. A new form of insurance, genetic insurance, can eliminate these problems and allow everyone to be insured.

Actuarial Analysis↗
PubMed1991

Genetic predictive testing and private insurances.

Genetic information is a potential tool for selection of job applicants and of candidates for insurance. Social implications of genetic information may represent a threshold for the access to health care facilities. Some of the issues related to the use of predictive genetic information by private life and health insurance companies are discussed. They include the potential threat for the privacy of the individual and his relatives, the pressure to undergo genetic testing and the social consequences of the use of genetic information by private insurance companies. The justified financial interests of insurance companies and the interests of the individual to have his privacy protected and to be able to partake in social attainments have to be brought into balance. A ban on genetic testing in connection with access to insurances and a limitation to the use of existing genetic information have been suggested by the Dutch Health Council. This approach to the problem should be adopted throughout the European Communities, so that medical progress does not turn out to be against the interests of the consumer.

AIDS Serodiagnosis↗
PubMed1990

Insurability and the HIV epidemic: ethical issues in underwriting.

The HIV epidemic has focused criticism on standard underwriting practices that exclude people with AIDS or at high risk for it from insurance coverage. Insurers have denied the charge that these practices are unfair, claiming instead that whatever is actuarially fair is fair or just. This defense will not work unless we assume that individuals are entitled to gain advantages and deserve losses merely as a result of their health status. That assumption is highly controversial at the level of theory and is inconsistent with many of our moral beliefs and practices, including our insurance practices. We should reject the insurers' argument. Justice in health care requires that we protect equality of opportunity, and that implies sharing the burden of protecting people against health risks. In a just healthcare system, whether mixed or purely public, the insurance scheme is in systematic terms actuarially unfair, for its overall social function must be to guarantee access to appropriate care. This does not mean that in our system insurers are ignoring their obligation to provide access to coverage. The obligation to assure access is primarily a social one, and the failures of access in our system are the result of public failures to meet those obligations. In a just but mixed system, there would be an explicit division of responsibility among public and private insurance schemes. In our mixed but unjust system, both legislators and insurers cynically pretend that the uninsured are the responsibility of the other. The attempt to treat actuarial fairness as a moral notion thus disguises what is really at issue, namely, the risk to insurers of adverse selection and the economic advantages of standard underwriting practices. Standard underwriting practices will be fair only if they are part of a just system, not if they simply are actuarially fair. The failure of the argument from actuarial fairness means that we must face an issue private insurers had hoped to avoid if we are to defend standard underwriting practices at all. In view of the clear risk that a mixed system will fail to assure access to care, the burden falls on defenders of a mixed system. They must show us that its social benefits outweigh its social costs, and that it is possible to have a mixed system that is not only just, but also is superior to a compulsory, universal insurance scheme.

Acquired Immunodeficiency Syndrome↗
PubMed2006

Biased selection within the social health insurance market in Colombia.

Reducing the impact of insurance market failures with regulations such as community-rated premiums, standardized benefit packages and open enrolment, yield limited effect because they create room for selection bias. The Colombian social health insurance system started a market approach in 1993 expecting to improve performance of preexisting monopolistic insurance funds by exposing them to competition by new entrants. This paper tests the hypothesis that market failures would lead to biased selection favoring new entrants. Two household surveys are analyzed using Self-Reported Health Status and the presence of chronic conditions as prospective indicators of individual risk. Biased selection is found to take place, leading to adverse selection among incumbents, and favorable selection among new entrants. This pattern is absent in 1997 but is evident in 2003. Given that the two incumbents analyzed are public organizations, the fiscal implications of the findings in terms of government bailouts, are analyzed.

Adolescent↗
PubMedDate not supplied

Are HMO enrollees healthier than others? Results from the community tracking study.

This analysis addresses the question of biased selection into health maintenance organizations (HMOs) by using recent, nationally representative data from the Community Tracking Study (CTS) to compare the health status of nonelderly privately insured persons enrolled in HMO and non-HMO plans. Contrary to the conventional view that HMOs receive favorable selection, we find among the privately insured that HMO enrollees are not healthier and may be slightly less healthy. To help understand that result, we present evidence suggesting that other factors, including cost considerations, may be more important than health when people are deciding whether to enroll in an HMO.

Adolescent↗
PubMed1989

The role of health practices in HMO selection bias: a confirmatory study.

This research examines the relation between employees' health practices and health plan selection. A previous study, limited to one firm, showed that employees choosing a health maintenance organization (HMO) and a fee-for-service (FFS) plan had similar health practices. We extend this inquiry to 17 Minneapolis employees, all of whom offer at least one FFS plan and one or more of the 6 Twin Cities HMOs. Health practices were measured by cigarette smoking, heavy drinking (or abstinence from drinking), use of seat belts, and exercise. We estimated health plan choice equations that show that employees with poor health practices do not systematically prefer FFS plans compared with independent practice associations (IPAs). Nor do they select FFS or IPA plans compared with HMOs on the basis of health habits. We suggest that HMOs do not gain long-term cost advantages by enrolling employees with favorable health practices.

Choice Behavior↗
PubMed1992

Pricing and imperfections in the medical care marketplace.

To summarize: Some economic literature treats price determination in the medical marketplace as if it were similar to that of a standard marketplace. It seems more realistic to treat it as an outcome of one or more administered price systems. Such systems, may be formula-based, as is common in the United States (for example, the Prospective Payment System), or not (for example, a negotiated budget). In either case, however, the actual price is likely to deviate from the ideal price in part for lack of information. Plausible deviations can explain some observed phenomena. The inability to attain the ideal price, together with heterogeneity of patients, may also explain why in practice we observe several different bases of provider payment; for example, fee-for-service, capitation, and salary. All of these may be attempts to arrive at second best prices. Ignoring any welfare loss from raising revenue and assuming those with the largest marginal social valuation for the service are served first, errors in price setting lead to a welfare loss that is approximately proportional to the square of the deviation from the ideal price. If price setting is unbiased (i.e., errors have a mean of zero), the welfare loss is approximately proportional to the variance of the error in setting price. If price setting is biased, welfare loss is approximately proportional to the variance plus the square of the bias. Taking account of welfare loss from raising revenue may make monopsonistic pricing optimal. If one uses multiple bases of payment, for example both fee-for-service and capitation, one can average the errors that arise in each basis. This creates a gain from using a mixed system, in addition to those gains cited by other analysts, who focus on the method of reimbursement assuming what, in the present context, could be termed error-free price effects. The gains from averaging errors would appear available in any administered price system and are compatible with a wide variety of models of provider behavior.

Delivery of Health Care↗
PubMedDate not supplied

Adverse selection and generosity of alcohol treatment benefits.

Concerns about attracting disproportionate numbers of employees with alcohol problems limit employers' willingness to offer health plans with generous alcohol treatment benefits. This paper analyzes two potential avenues of adverse selection, namely biased enrollment into plans and biased exit from plans offered by 57 employers between 1991 and 1997. We compare alcohol treatment use rates and costs of new and old enrollees between more generous and less generous plans; we also analyze disenrollment rates and enrollment duration by plan generosity for users and nonusers of alcohol treatment services. To avoid confounding benefit generosity with other plan features, in particular the use of managed care mechanisms, we compare plans that were administered in the same way by a large managed behavioral health care organization. Overall, we find no evidence of adverse selection into more generous plans. Contrary to the selection hypothesis, treatment costs of new members compared to old members are lower in firms with more generous treatment benefits than in firms with more limited benefits. Also, users of alcohol treatment services do not remain disproportionately enrolled longer in plans with generous benefits.

Alcoholism↗
PubMed1994

Eating disorders and health insurance.

Eating disorders are being diagnosed and managed by an increasing number of pediatricians and practitioners of adolescent medicine. These physicians are increasingly discovering the power and importance of their patients' health insurance status in the management of these conditions because the lack of appropriate insurance may often pose obstacles and barriers to care. This article provides an analysis of this situation through brief case presentations followed by a discussion and recommendations.

Adolescent↗
PubMed1994

Alpha 1-antitrypsin deficiency. Impact of genetic discovery on medicine and society.

An increasing body of molecular information resulting from advances in basic research is being incorporated into clinical practice by medical genetics. The process by which these research advances progress from the laboratory to the bedside and their medical, social, and legal impact is a topic of intense current interest. Some authors have claimed that new genetic information may lead to discrimination in insurance and employment; change the way courts allocate responsibility for injury and resultant damages; and be inappropriately interpreted by the medical profession. To address some of these issues, we chose, as a model, to review alpha 1-antitrypsin deficiency, described over 30 years ago. At this time, such concerns with respect to alpha 1-antitrypsin deficiency have not yet been realized, perhaps for the following reasons: (1) knowledge of alpha 1-antitrypsin deficiency, while common among geneticists and pulmonologists, has not been well disseminated in the medical community; (2) insurers, employers, lawyers, and judges are not generally aware of the deficiency and its implications; (3) insurers, if they are aware of the deficiency, have not found it cost-effective to screen for the condition; and (4) in the legal context, case law involving other types of preexisting conditions is being applied to genetic predispositions.

Biomedical Research↗