Establishing an Analytical Framework for Measuring the Role of Reinsurance in the Health Insurance Market

This is a limited analytic study of the role of reinsurance (and similar coverages) in three insurance markets: primary health insurance coverage offered by indemnity insurance companies; health insurance coverage offered by health maintenance organizations; and health benefits coverage offered by employer-sponsored self-insured plans. The purpose of the study is to develop a better understanding of the roles that reinsurance plays in the market for health benefit coverage by looking at the amount of risk borne by reinsurance in the three primary conduits for health coverage: indemnity health insurance, HMO coverage and self-funded health plans.

Prepared for The Office of the Assistant Secretary for Planning and Evaluation,

Department of Health and Human Services by The Lewin Group,

March 20, 1997