Trends in Premiums in the Small Group and Individual Insurance Markets, 2008-2011. Selection of Carriers within States


The original sampling strategy called for grouping carriers into three strata based on the number of lives each covers per state: (1) 1,000 or more covered lives, (2) 500 to 999 covered lives, and (3) fewer than 500 covered lives. Under the original plan, NORC aimed to select eight carriers for the group market and seven carriers for the individual market per state. Documents from the NAIC were the source of information for state enrollment in the individual and small group markets. In the revised sampling strategy, any of the five largest carriers in the state for which data were available were selected from the first stratum (1,000 or more covered lives), with the remainder selected from the other two strata in proportion to covered lives between the two strata. Carriers from the second two strata were systematically selected following similar rules as for the selection of states.

For generating the desired state-level and national estimates, we also distinguished filings based on the relevant market and type of product. A market is defined to be individual or small group. We identified conversion policies separately, but included them in the individual market for purposes of the analysis. 18 A product is classified as HMO, PPO, or indemnity. 19 We identified high-deductible plans separately when they were in separate rate filings (in which case they are aggregated with PPO plans for the purposes of this analysis). More frequently, premium increases for high-deductible plans were not filed separately. When reported in a separate filing, we included increases in high-deductible plans with the product type alongside which they were filed (HMO, PPO, or indemnity).

18 Authorized by the Health Portability and Patient Protection Act (HIPPA), conversion policies are available to individuals when an individual’s group health insurance policy ends, usually due to termination of employment. The carrier that provided the employer's group insurance plan also provides the conversion policy. Employees may need to apply for COBRA coverage first, and then wait until the coverage period ends before obtaining a conversion policy. Regulations vary from state to state. See

19 We believe that many carriers offer plans that use an indemnity license, but are actually PPO plans. The Kaiser Family Foundation/Health Research and Educational Trust Employer Health Benefits Survey estimates that indemnity plans constitute about 1 percent of enrollment in the small group market. Data from filings in the small group market suggest a figure that substantially exceeds 1 percent.

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