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Aggressive regulator or passive price-taker: what role should HIPCs (health insurance purchasing cooperatives) play?

Despite extensive variations on the theme, managed competition continues to be the favored model of federal and state governments in crafting health reform. A critical element in managed competition is the establishment of health insurance purchasing cooperatives (HIPCs), which band together the collective buying power of individuals or employers to give them market "clout". Policymakers must decide whether they want a HIPC to be an aggressive regulator--using its power to force changes among health plans--or a passive price-taker that contracts with plans meeting key criteria.

Competitive Medical Plans↗

Small businesses' changing views on health reform.

Our national sample of 750 randomly chosen firms with fewer than 50 employees reveals surprising findings about the traditional views of small business on health care reform. A substantial segment of the small business community is sympathetic to health care reform, including such controversial measures as mandating that all employers contribute to the coverage of their workers, limits on health care spending, and altering the tax treatment of employer contributions for health insurance. Without premium savings, fewer than half of small businesses support the concept of health insurance purchasing cooperatives. With premium savings, a majority support it.

Attitude to Health↗

Employers give managed competition a new spin.

Redefining managed competition, employers adopt group purchasing and competitive bidding for provider services. The common underpinning is rewarding quality and efficiency.

Competitive Bidding↗