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

03/20/1997

Additional Reinsurance Tabulations from KPMG

Tables E-1 through E-6 present the proportion of plans, by type, with stoploss thresholds of various levels. KPMG Peat Marwick's produced these tables for The Lewin Group from KPMG's database of employer-sponsored health benefits. This database was derived two nationally representative surveys of public and private employers conducted in the spring of 1995. The large employer survey (for firms with 200 or more workers) was designed and conducted by KPMG Peat Marwick, while the small firm survey (for firms with fewer than 200 workers) was designed and conducted by Wayne State University in conjunction with KPMG Peat Marwick. The two surveys use similar questionnaires and the same interview protocol and sample replacement methods.

Overall, 2,037 interviews were completed in 1995, corresponding to a response rate of 64 percent (2,037 of 3,173 contacts) for the two surveys combined. By size of firm, the response rates were: 1-49 employees, 58 percent (616 of 1,056); 50-199 employees, 50 percent (385 of 771); and 200 or more employees, 77 percent (1,037 of 1,346). The average telephone interview lasted 22 minutes.

 

Table E-1

Percentage of Employers with Different Types of Health Coverage, by Firm Size, 1995

Number of Employees 1-24 25-49 50-199 200-999 1,000 or More All Firms
Conventional
Overall 33.4 33.7 25.1 30.1 28.1 33.0
Fully self-insured 2.0 1.2 1.2 4.5 9.5 1.9
Partly self-insured 2.0 3.1 4.5 12.1 13.7 2.4
Other risk arrangement 29.4 29.3 19.4 13.5 4.9 28.7
HMO
Overall 21.2 32.1 20.6 22.2 25.9 21.8
Fully self-insured 0.9 0.0 0.5 1.2 3.0 0.9
Partly self-insured 0.0 0.0 0.2 1.3 2.2 0.0
Other risk arrangement 20.3 32.1 19.9 19.7 20.7 20.9
PPO
Overall 24.5 24.4 31.9 28.8 26.9 24.9
Fully self-insured 0.9 2.7 2.1 5.3 10.5 1.1
Partly self-insured 0.2 1.1 7.0 13.7 11.9 0.8
Other risk arrangement 23.4 20.6 22.8 9.8 4.5 23.0
Point-of-Service
Overall 20.9 9.9 22.4 18.9 19.1 20.4
Fully self-insured 1.7 0.0 1.2 2.5 5.3 1.6
Partly self-insured 1.0 1.2 1.9 9.2 8.6 1.2
Other risk arrangement 18.2 8.7 19.3 7.2 5.2 17.6

Source: KPMG Peat Marwick tabulations for the Lewin Group.

 

Table E-2

Characteristics of Non-Purchased Plans Which Are Partly Self-Insured or Which Use Some Risk Arrangement Other Than Complete Self-Insurance, 1995

Percentage of Employers by Response Yes No Don't Know
Conventional
Minimum Premium Plan 10.3 51.2 38.4
Reinsurance or Stoploss 63.4 35.7 1.0
ASO Contract 8.3 84.0 7.7
HMO
Minimum Premium Plan 24.4 62.0 13.6
Reinsurance or Stoploss 78.7 13.0 8.3
ASO Contract 48.1 41.0 10.9
PPO
Minimum Premium Plan 45.4 43.7 10.9
Reinsurance or Stoploss 80.1 16.9 3.0
ASO Contract 18.2 59.4 22.4
Point-of-Service
Minimum Premium Plan 8.1 83.9 8.0
Reinsurance or Stoploss 98.1 1.5 0.4
ASO Contract 81.2 12.9 5.8

Source: KPMG Peat Marwick tabulations for the Lewin Group.
 

Table E-3

Percentage of Employers with Plans with Stoploss Policies

  Conventional Plans HMO Plans PPO Plans POS Plans
Percentage of employers with plans employing stoploss agreements 0.7 NSD 0.3 0.6
Stoploss threshold policy by percentage of employers
Annual losses per participant 22.3 NSD 85.5 95.0
Lifetime losses per participant 4.6 NSD 5.5 0.3
Annual total losses for company 3.0 NSD 7.4 1.0
Total losses for company, unspecified time 2.7 NSD 1.6 0.0
Don't know policy 67.3 NSD 0.0 3.7

Figures may not add to 100 percent due to rounding.

Source: KPMG Peat Marwick tabulations for the Lewin Group.

Table E-4

Conventional Plans -- Percentage of Employers at Dollar Amount Thresholds, by Firm Size and Type of Stoploss Policy, 1995

  Firms with 1-99 Employees Firms with 100-199 Employees
Annual losses per participant: Percentage of Employers by Threshold Level
$3,000-20,000 51.2 29.2
$20,001-50,000 16.0 55.9
$50,001-100,000   4.3
Don't know level 32.8 10.3
Lifetime losses per participant: Percentage of Employers by Threshold Level
$3,000-20,000   50.0
$20,001-50,000    
$50,001-100,000 65.7 50.0
Don't know level 34.3  
Annual total losses for company: Percentage of Employers by Threshold Level
$3,000-20,000 100.0 14.8
$20,001-50,000   35.2
$50,001-100,000   14.8
Don't know level   35.2
Total losses for company, no specified time limit: Percentage of Employers by Threshold Level
$3,000-20,000    
$20,001-50,000 100.0  
$50,001-100,000    
Don't know level    

Figures may not add to 100 percent due to rounding.

Source: KPMG Peat Marwick tabulations for the Lewin Group.

Table E-5

Preferred Provider Organization -- Percentage of Employers at Dollar Amount Thresholds, by Firm Size and Type of Stoploss Policy, 1995

  Firms with 1-99 Employees Firms with 100-199 Employees
Annual losses per participant: Percentage of Employers by Threshold Level
$3,000-20,000 77.8 20.0
$20,001-50,000 16.8 55.5
$50,001-100,000   10.9
Don't know level 5.6 13.7
Lifetime losses per participant: Percentage of Employers by Threshold Level
$3,000-20,000   100.0
$20,001-50,000    
$50,001-100,000    
Don't know level 100.0  
Annual total losses for company: Percentage of Employers by Threshold Level
$3,000-20,000   21.4
$20,001-50,000   39.3
$50,001-100,000    
Don't know level   39.3
Total losses for company, no specified time limit: Percentage of Employers by Threshold Level
$3,000-20,000    
$20,001-50,000    
$50,001-100,000    
Don't know level   100.0

Figures may not add to 100 percent due to rounding.

Source: KPMG Peat Marwick tabulations for the Lewin Group.

 

Table E-6

Point of Service Plan -- Percentage of Employers at Dollar Amount Thresholds, by Firm Size and Type of Stoploss Policy, 1995

  Firms with 1-99 Employees Firms with 100-199 Employees
Annual losses per participant: Percentage of Employers by Threshold Level
$3,000-20,000 15.3 27.0
$20,001-50,000 80.9 72.9
$50,001-100,000    
Don't know level 3.8  
Lifetime losses per participant: Percentage of Employers by Threshold Level
$3,000-20,000    
$20,001-50,000    
$50,001-100,000    
Don't know level   100.0
Annual total losses for company: Percentage of Employers by Threshold Level
$3,000-20,000    
$20,001-50,000    
$50,001-100,000   29.6
Don't know level   70.4
Total losses for company, no specified time limit: Percentage of Employers by Threshold Level
$3,000-20,000    
$20,001-50,000    
$50,001-100,000    
Don't know level    

Figures may not add to 100 percent due to rounding.

Source: KPMG Peat Marwick tabulations for the Lewin Group.