Findings from Illinois State University Provides New Data on Insurance (Managed Care or Carefully Managed? Management of Underwriting Profitability By Health Insurers): Insurance

Health Policy and Law Daily

2023 FEB 08 (NewsRx) -- By a News Reporter-Staff News Editor at Health Policy and Law Daily -- Current study results on Insurance have been published. According to news reporting originating from Normal, Illinois, by NewsRx correspondents, research stated, “Managed care provides health insurers a unique opportunity for discretion over certain aspects of financial reporting. Specifically, managed care mechanisms provide health insurers with a stronger ability to engage in loss control.”

Our news editors obtained a quote from the research from Illinois State University, “To test whether and how health insurers exploit their ability to manage losses, we examine whether insurers with greater opportunity to manage care report significantly better underwriting performance in the fourth quarter relative to other health insurers. Using quarterly statutory filings from 2003 to 2016, we find evidence that a health insurer’s share of enrollment in health maintenance organisation (HMO) plans, characterised by their use of ‘gatekeeper’ physicians, is significantly and negatively related to their reported fourth quarter medical loss ratio (MLR).”

According to the news editors, the research concluded: “Additionally, while we find that fourth quarter MLRs are higher for all health insurers following the implementation of the Patient Protection and Affordable Care Act (ACA), the ACA does not appear to have intensified the loss control efforts of those insurers with more enrollment in HMO plans.”

This research has been peer-reviewed.

For more information on this research see: Managed Care or Carefully Managed? Management of Underwriting Profitability By Health Insurers. The Geneva Papers on Risk and Insurance - Issues and Practice, 2023;48(1):5-31. The Geneva Papers on Risk and Insurance - Issues and Practice can be contacted at: Palgrave Macmillan Ltd, Brunel Rd Bldg, Houndmills, Basingstoke RG21 6XS, Hants, England.

The news editors report that additional information may be obtained by contacting E. Tice Sirmans, Illinois State University, Dept Finance Insurance & Law, Normal, IL 61761, United States. Additional authors for this research include Patricia H. Born and Evan M. Eastman.

The direct object identifier (DOI) for that additional information is: https://doi.org/10.1057/s41288-021-00239-1. This DOI is a link to an online electronic document that is either free or for purchase, and can be your direct source for a journal article and its citation.