This application is for a small grant to convene researchers and employers to consider the problem of adverse selection in the private employer health insurance market, and to further consider the role of risk adjustment in addressing this issue. Private employers are the largest source of enrollees of managed care plans, yet make little use of risk adjustors, even shunning use of such readily available adjustors like family size and age. Why is this? Is it simply a matter of educating employers, or are there more complex economic issues facing the employer in the overall design and purchasing of employee benefits? This proposed conference, tentatively scheduled for early October, 1999 in Boston, Massachusetts, is designed to address and analyze this issue. The proposed conference will bring together representatives from private employers, to tell about what they do and do not do, and why, with researchers with preliminary ideas on the topic. We hope, by the conference, to 1) stimulate research on the implications of market practices, and 2) suggest ways employers might make better use of existing risk adjustment research. Six papers will be written for the conference. The papers, revised after the conference, will be published in a special section of the journal, Inquiry.
