Risk-rated health insurance programs: a review of designs and important issues

PURPOSE OF THE REVIEW. The purpose of this review is to assist those who work in the field of health promotion when considering the implementation of an individually risk-rated health insurance plan. It does so by introducing the reader to the concept of individually risk-rating health insurance; uncritically reviewing selected risk-rated health insurance plans; and exploring several issues related to plan implementation, administration, and appropriateness. SEARCH METHODS USED. The review is based on the authors' awareness of the literature in the fields of preventive medicine, health promotion, and employee benefits. The six individually risk-rated health insurance programs that are reviewed were chosen because they demonstrate how aspects of the National Association of Insurance Commissioners' Model have been implemented using various combinations of administrative procedures, verification strategies, and types of economic incentives or disincentives. This review is not intended to be a comprehensive review of the literature. SUMMARY OF IMPORTANT FINDINGS. Individually risk-rated health insurance programs have been established using a variety of administrative procedures, verification strategies, and types of economic incentives or disincentives. The frequency with which these programs are being established is increasing. As the number of risk-rated programs grows, it will be increasingly important to address the many issues that implementing such plans generate: How should lifestyle behaviors be verified? Will healthy lifestyles save money? Can employees fully control their risk factors? Is risk-rating socially responsible? MAJOR CONCLUSIONS. As risk-rating becomes more widespread, there will be a continuing need to address the business, medical, ethical, and legal issues these programs create and to refine them accordingly. The health promotion community has both an opportunity and obligation to see to it that individually risk-rated health insurance programs are implemented in a socially acceptable manner and that the outcomes they generate are cost-beneficial.