The Health Insurance Portability and Accountability Act of 1996 (HIPAA) establishes a federal role for regulating the employer group and individual insurance markets (Atchinson and Fox, 1997). The goals of Title I of the legislation are to provide coverage security for those currently insured. Title I guarantees the availability of insurance to all small employers (with 2 or more employees) and assures that individuals who leave employment are able to maintain health insurance coverage. Thus, HIPAA ensures access to insurance for some employer groups and individuals who previously were unable to purchase health insurance or unable to purchase adequate coverage. What effect this will have on the number of uninsured or the price people pay for insurance is, however, a matter of some uncertainty. Moreover, variability among states in existing insurance legislation, and the flexibility that states are given to implement the individual market reforms suggests that the answer to these questions will vary from place to place.
This paper examines the extant literature on issues pertaining to HIPAA and the general insurance access problems it was designed to address. The goal of the review is to generate hypotheses about the likely effects of HIPAA, the magnitude of those effects, how the effects are likely to vary between population groups, and how background, policy, or implementation characteristics might influence the magnitude of the effects. These hypotheses and the identification of mediating factors will inform the development of a plan for evaluating HIPAA.
In the next section of this paper, we provide a brief overview of the provisions of HIPAA. This is followed by a discussion of the potential effects of these provisions in the group market and the individual market. To estimate these effects, we searched the literature in research journals, the employee-benefits trade press, and reports of private and public organizations for information about HIPAA and the provisions it contains, including: guaranteed issue, guaranteed renewal, portability, pre-existing condition exclusion limits, and non-discrimination provisions. We also reviewed literature on the performance of state high-risk pools, one of the alternative mechanisms that states are allowed to adopt to meet the HIPAA provisions for the individual market reforms. We conclude with some summary observations about the implications for an evaluation design.