The development and growth of employer-provided health insurance

Monthly Labor Review, March, 1994 by Laura A. Scofea

16 The scope of establishments included in the survey of medium and large private establishments was expanded in 1988. See Technical Note, Appendix A, Employee Benefits in Medium and Large Private Establishments, 1991, p. 129, for details on changing survey methodology.

Laura A. Scofea is an economist in the Division of Occupational Pay and Employee Benefit Levels, Bureau of Labor Statistics.

Glossary of terms

First-dollar coverage: Coverage for an insured individual who is not required to make an initial payment for care before insurance benefits are available.

Health maintenance organization (HMO): A managed care insurance plan that provides a wide range of comprehensive health care services to subscribers for a predetermined rate.

Group/staff arrangements: A health maintenance organization arrangement that delivers health services at one facility or more with groups of salaried physicians.

Individual practice associations: A health maintenance organization plan that contracts with physicians who maintain their own offices and usually are paid by the HMO according to an agreed upon fee-for-service schedule.

Preferred provider organization (PPO): A managed care insurance plan that covers individuals on a fee-for-service basis and offers a choice of providers. Out-of pocket expenses for medical care are lower if the subscriber uses designated hospitals, physicians, or dentists.

Open-ended enrollment plan: The most popular variation in HMO's in which members of this plan may use providers outside the HMO network but incur an additional cost, typically a deductible and coinsurance beyond those normally imposed for services.

Deductible: A specified amount that the insured individual must pay toward medical expenses before the plan pays charges. Any medical expenses that are more than the deductible are shared by the employee and the plan in a predetermined coinsurance formula.

Supplemental insurance: Supplemental plans offer additional coverage to what is provided in the basic plan by covering expenses that exceed the limits of the basic plans and expenses not covered by the basic plan.

Comprehensive insurance: Comprehensive major medical plans do not offer "additional" coverage to a basic plan; they cover a wide range of medical services in one package. For "pure" comprehensive major medical plans, all covered expenses are subject to a deductible and a coinsurance requirement before benefits are provided.

[Tabular Data Omitted]