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Employment and Health Benefits: A Connection at Risk
more employers have opted for self-insurance arrangements that are exempt from state oversight and as the courts have broadened the interpretation of ERISA's preemption of state statutory and common law in matters "related to" employee benefits.
Overall, for most Americans with a strong connection to the workplace, the system provides very reasonable access to the benefits of biomedical science and technology at a relatively modest direct personal cost in the form of premium contributions and other cost sharing. When people are asked to rate the most important employee benefit, a substantial majority select health benefits. Surveys also indicate that more Americans think employers rather than government should be the most responsible for providing health benefits for full-time employees and their dependents, although no specific plan design or policy commands the unequivocal support of the majority.
The offering of employment-based health benefits is virtually universal in large and medium-sized organizations. These organizations generally cover a large portion of the cost or premium for employee coverage but vary considerably in their contributions for family coverage. They often help employees understand their health coverage and resolve problems with specific health plans. Employers have become increasingly active in the management of health benefits by offering employees choices among competing health benefit plans that limit employee choice of health care practitioner, adding managed care features to indemnity health plans, and developing workplace health promotion programs. At the same time, some larger employers are focusing—more than ever before—on how they can have employees pay a larger share of costs directly, how they can avoid sharing the risk for medical care and benefit costs for anyone other than their employees and, perhaps, their dependents, and how they can get the best possible rates from health care providers regardless of the impact on others in the community. In this latter regard, they join Medicare, Medicaid, and some network health plans in contributing to concerns about cost shifting, that is, the attempt by health care providers to make up for certain payers' discounts and underpayments through higher charges to less powerful groups and individuals.
Table 7.1 depicts some of the important functions assumed by employers and their relative difficulty or complexity. In general, the participation by employers in these functions falls off sharply between the first and second functions (particularly among small employers) and the second and third functions represented on the left side of the table. The table does not attempt to rate employer performance or to portray the positive and negative effects on employees or the community that may follow from specific steps taken by employers in carrying out these functions.
Only about half of all workers are employed by the large and medium-