Jean Abraham - Shadac

ESI Premium Data and ConstructionCBOGMSIM(Gruber)RAND COMPAREHBSM(LEWIN)HIPSM(URBAN)Data 2004 MEPS 2004 MEPS-IC 2007-08 KFF/HRET2002-2003 MEPS2006 KFF/HRET and 1997RWJF Employer HealthInsurance Survey2002-2005 MEPS-HCMEPS-IC2006-2008 MEPS-HCExpectedSpending / CostsExpectedaggregatespending of afirm’s workersIndividual-level costindex based on age,sex, health rating.Averaged oversynthetic firm. Indexmatched up toemployer premiumdistribution to assignpremium to firm.Firm-specific premiums are afunction of experience-ratedand community-ratedestimates. Former usepredicted spending ofworkers and dependents,while the latter use 12 poolsbased on 4 census regionsby 3 firm sizes.Use expenditures ofworkers and apply ratingpractices (e.g., smallgroup market). Alsosimulate premiums forself-funded plans.Built from riskpools fromunderlying healthcare spending.Blend of actualand expectedcosts.Actuarial ValueadjustmentYes (firm size,income, healthstatus)Yes (income, firmsize)Yes (firm size)Yes (comparison ofemployer plan to standardbenefits)Yes (firm size)Loading Fee 27% for 2employee firmto 9% for 100+workersImplicit in premium20%: < 25 workers13%: 25-99 workers8.3% for 100+ workersRanges from40% for 1-4 workers to5.5% for 10,000+ workersYes (industry andfirm size)State-specificinformationRegulatoryenvironmentAccounts for statevariation in premiumsDetails not availableImpute state code toMEPS; small group ratingrulesAccounts forstate variation inspending