Employer‐Sponsored Health Insurance and Mandated Benefit Laws

Abstract

Regulations for the content of private health plans, called mandated benefit laws, are widespread and growing in the United States, at both state and federal levels. Three aspects of these laws are examined: their current scope; some economic reasons for their existence; and the theory and empirical evidence for their effects in health insurance markets. A growing body of literature suggests that society is paying a high price for enhanced coverage via mandated benefits. These laws increase insurance premiums, cause declines in wages and other fringe benefits, and lead some employers and their workers to forgo health benefits altogether. The cost of mandated benefit laws falls disproportionately on workers in small firms.

The relationship between HAART use and employment for HIV-positive individuals: an empirical analysis and policy outlook

“…Mandate laws include statutes that require health plans to extend coverage to (1) services by particular types of providers (e.g., chiropractors, optometrists), (2) specific diagnostic or treatment services (e.g., mammography, inpatient hospital care following delivery, diabetes treatment), and (3) certain populations (e.g., continuation coverage of former employees or their dependents). Although most states have passed mandate benefit laws [36], studies on the effects of mandated benefits have generated mixed results [37][38][39][40]. Researchers agree that the financial burden of these laws fall disproportionately on workers in small firms since these firms are less likely to self-insure and circumvent the consequences of the mandates (i.e., premium increases).…”

Effects of Federal Policy to Insure Young Adults: Evidence from the 2010 Affordable Care Act's Dependent-Coverage Mandate

“…The use of private-insurer mandates has been a popular way for governments to increase health insurance provision without much new public spending (Jensen and Morrissey 1999). In these cases, the relatively small increases in public spending result from shifting compensation packages from wages to health insurance, which is tax exempt.…”

Embryo transfer practices and perinatal outcomes by insurance mandate status

“…Infertility-related services are covered to the same extent as pregnancy-related services, and there is no limit on the number of treatment cycles and no lifetime cap on coverage. Employers that self-insure are not required to provide state-mandated benefits because the federal Employee Retirement Income Security Act preempts the state law (17). Currently, Michigan and Florida have no mandate.…”