HEALTH

Investigation of market-based influences on health insurance
Small Business Administration

Econometrica is conducting research on behalf of the Small Business Administration (SBA) regarding the continuing escalation of healthcare costs and the impact on small businesses. Our work under this contract departs from past research efforts that focused on worker costs and access for employer-sponsored health insurance (ESI) policies and the dynamics of group plan offerings made to small and midsize employers (fewer than 500 employees). We focus on a market-based model that examines regional economic climate and the characteristics of local labor pools. This approach incorporates and builds on findings from previous research, while disentangling the influences of regional costs and industries.

Econometrica is using public and confidential data from the Medical Expenditure Panel Survey (MEPS), collected and maintained by the Agency for Health Care Quality and Research, to investigate market-based influences on the availability, cost, and value of employer-based healthcare insurance. We test multilevel models that examine the distinct impact of market- and state-based influences, while the 2001 linked household-insurance data examines the unique contributions of employer and employee decisions. The primary product from this research is a manuscript that will be submitted to academic journals and at research conferences to expand the knowledge base on employer-based research.