142nd APHA Annual Meeting and Exposition

Annual Meeting Recordings are now available for purchase

Effect of multiple employer-sponsored health insurance plans on utilization among two-worker families

142nd APHA Annual Meeting and Exposition (November 15 - November 19, 2014): http://www.apha.org/events-and-meetings/annual
Monday, November 17, 2014

Hyo Jung Tak, PhD , Department of Health Management and Policy, University of North Texas Health Science Center, Fort Worth, TX
Gregory Ruhnke, MD MPH , Department of Medicine, University of Chicago, Chicago, IL
Objective: An estimated 7.6 percent of the non-elderly population is in a family having multiple employer-sponsored health insurance plans (ESHIPs) concurrently. A family might have multiple ESHIPs when a husband and wife are each eligible for separate employer-sponsored plans. We hypothesized that families would enroll in multiple plans only in the presence of significant premium subsidies and/or the accrual of additional net benefits with dual coverage, which could result in moral hazard. We investigated whether non-elderly individuals in a family with multiple ESHIPs report higher levels of health service utilization.

Methods: We used the 2006-2010 Medical Expenditure Panel Survey Household Component, restricting the sample to families in which both spouses are offered health insurance by their employers (15,349 individuals in 4,979 families). The primary independent variable was a family-level binary indicator reflecting multiple ESHIPs. Utilization was measured by the annual number of physician and non-physician visits in the calendar year prior to the interview. We estimated the relationship between multiple ESHIPs and the utilization measures with a negative binomial model, and a two-stage residual-inclusion model in which the characteristics of each spouses’ employers were used as instrumental variables (IVs). We performed these estimates for the total sample population and stratified by the presence of children in the family. Socio-demographic characteristics, health status, and location of residence were also controlled.

Results: On average, respondents visited physicians 2.78 times and non-physicians 1.60 times in the calendar year. Among those eligible for multiple ESHIPs, 38.7 percent of families were enrolled in two ESHIPs. Without controlling for potential endogeneity, among respondents with children, those covered by multiple ESHIPs visited physicians 0.26 times (average marginal effect(AME)=0.26;p-value=0.02) more per year, compared to individuals enrolled in a single ESHIP. In the non-linear IV estimation, the constructed AME was 0.45(p-value=0.34) among respondents with children. The estimation results were not statistically significant for the total sample population, and among families without children. Notably, the non-linear IV model did not pass the endogeneity test(p-value =0.07), implying that enrollment in multiple ESHIPs is more likely due to large subsidies rather than selection.

Conclusion:  Although policymakers generally focus on the consequences of being uninsured, our study suggests that multiple ESHIPs within families may lead to inefficient welfare losses via moral hazard. Given our findings that the primary driver of dual coverage decisions is generous premium subsidies from employers, policies might address the inefficiencies created by the tax incentives to provide such subsidies.

Learning Areas:

Biostatistics, economics
Public health or related public policy
Public health or related research
Social and behavioral sciences

Learning Objectives:
Analyze whether non-elderly individuals in a family with multiple employer-sponsored health insurance plans report higher levels of health service utilization

Keyword(s): Economic Analysis, Health Insurance

Presenting author's disclosure statement:

Qualified on the content I am responsible for because: I received my doctoral degree at the public policy at the University of Chicago. My primary fields are health economics, health policy, and health services research. During my three years of postdoctoral program, I worked with multidisciplinary research projects including effects of physician training program on health outcomes and expenditures, cost-effectiveness analysis, and patient-centered care. I believe my knowledge and experience will contribute to this research.
Any relevant financial relationships? No

I agree to comply with the American Public Health Association Conflict of Interest and Commercial Support Guidelines, and to disclose to the participants any off-label or experimental uses of a commercial product or service discussed in my presentation.