Employer Decision Making Regarding Health Insurance. Introduction

Many public policies seek to influence the decisions employers make about whether and how to offer health benefits to their employees. The “outcomes” of such policies can be measured--how many firms offer, how many employees have coverage, etc.--but the process of how employers make decisions is largely unknown. The employer decision-making process is something of a black box--public policy is made and eventually there may be a change, but we do not usually know how effectively the public policy has altered employers’ decisions or whether there are more effective means of influencing them.

ASPE decided to convene two panels of senior corporate managers to discuss how firms make decisions about health benefits. The meetings were held in January and March, 2000 in Washington, D.C. The purpose of the panels was to help the office formulate a more comprehensive view of employer decision-making by posing common questions to a cross- section of knowledgeable people, and to identify issues that we may be able to empirically measure. The long-term goal is to be able to better determine how public policies affect or influence the decisions made by employers and unions regarding health coverage.

ASPE contracted with Mathematica Policy Research, Inc. to organize two facilitated meetings. One meeting focused on the larger “strategic” trends and issues affecting employer health coverage. This meeting addressed global questions such as, “What is the role of the employer in shaping health care markets?” The second meeting focused on the more internal and operational issues of how employers make health benefit decisions. This second meeting addressed questions such as, “At what level of the corporate structure are health benefit decisions made?” Each half- day meeting included 7-9 panelists drawn from the industry as well as 8-10 ASPE participants. The Contractor prepared written summaries of both meetings which follow.