The Impact of Access Regulation on Health Insurance Market Structure. Commercial insurers


The NAIC data. Our basic source of information about commercial insurers is the annual financial reports that each admitted insurer files in each state, compiled by the National Association of Insurance Commissioners (NAIC). In all states, each commercial insurer files an extensive set of forms with the state, submitting information on premiums (written and earned), medical losses, administrative costs, surplus and reserves. These data are public use.

Alpha Center Survey of Commercial Insurers. In August and September 1998, Alpha Center fielded a mail survey of all commercial insurers that reported writing at least $500,000 in any line of health insurance in any state. Lines of health insurance that insurers report as an aggregate include major medical, hospital or hospital surgical, accident, disability, dread disease, dental, vision, or any other specialty health insurance product. The survey consisted of individualized forms mailed to each insurer (679 companies). Separate surveys were sent for group and individual lines of business; an insurer writing both lines received two survey forms. In all, 885 line-of-business surveys were mailed. Respondents were asked to identify how much of their business in each state and year (1995, 1996, and 1997) was major medical, how many lives were covered, and whether they were actively marketing in the state in that year. We requested and obtained from HIAA a personally signed letter endorsing the survey and asking that the insurer respond.

Survey response. In October, Alpha Center staff began follow-up phone calls to each insurer that had not responded to the survey, and repeated phone calls to the largest insurers in the survey. The largest insurers were called not fewer than five times, and other avenues (e.g., having HIAA also place a call to the insurer) also were pursued to obtain a response. At the conclusion of this effort, 334 companies had responded, providing information on 446 lines of business. The overall company response rate was 49.2 percent; the line-of-business response rate was 50.4 percent. Survey response rates by line of business are reported in Table A1.

  Total Group Surveys Individual Surveys
Surveys mailed 885 526 359
Surveys received 446 247 199
Response rate (percent) 50.4 47.6 55.4

Supplemental sources of information. To gain information about insurers that did not respond to the survey, we went to other public sources of information. None of these sources provides complete information about a reporting commercial insurers group and individual business, but each was valuable in providing some key information about at least part of the insurers business.

  • The NAIC Accident and Health Policy Exhibit. The Accident and Health Policy Exhibit provides valuable detail about companies individual health insurance business. However, not all companies file this Exhibit, and the NAIC sells it only in photocopy form. Of the insurers that did not respond to our survey, 60 companies did file this exhibit. We obtained this exhibit these companies, as well as a number of reporting companies in order to ascertain the comparability and integrity of this source.
  • Schedule H Accident and Health Exhibit. In 1997, the NAIC added a new section to this Exhibit, requiring companies to report their claims by type of claim (i.e., medical, dental and other). We assumed that companies which reported no medical claims for the year wrote no medical coverage that year. Using this information, we ascertained that 55 non-respondents in the individual market and 54 non-respondents in the group market wrote no major medical coverage.

Using these three sources of information – the Alpha Center survey, the NAIC Accident and Health Policy Exhibit, and the NAIC Schedule H Accident and Health Exhibit – we obtained observations for 314 of 359 commercial insurers in the individual market (87.5 percent) and 301 of 526 companies in the group market (57.2 percent). To improve our information about the group market, we systematically explored additional avenues of information about nonreporting companies (specifically, their SEC filings, the states’ Department of Insurance web pages, and conversations with various Department of Insurance officials). Our estimates of the proportion of the group and individual markets “known” in each state include information obtained by these other means for 13 group insurers and 2 individual insurers.