Measuring the generosity of employer-sponsored health plans: an actuarial-value approach

Source: Thomas G. Moehrle, U.S. Bureau of Labor Statistics, Monthly Labor Review, June 2015

The actuarial value of a health insurance plan has long been used by plan administrators to appraise their company’s probable outlay on health insurance claims. But the insured view the actuarial value as a measure of the generosity afforded by a health plan. This study estimates the actuarial values of employer-sponsored health insurance plans using survey data collected from the BLS National Compensation Survey (NCS) and the Medical Expenditure Panel Survey, which is administered by the Agency for Healthcare Research and Quality. These estimates, along with existing health-insurance provisions estimates published by NCS, could provide a more comprehensive assessment of employer-sponsored health insurance benefits offered to American workers if measures of statistical significance were applied to them.