Policymakers are considering legislative changes that would increase managed care organizations’ exposure to civil liability for withholding coverage or failing to deliver needed care. Using a combination of empirical information and theoretical analysis, the authors assess the likely responses of health plans and Employee Retirement Income Security Act (ERISA) plan sponsors to an expansion of liability, and they evaluate the policy impact of those moves. They conclude that the direct costs of liability are uncertain but that the prospect of litigation may have other important effects on coverage decisionmaking, information exchange, risk contracting, and the extent of employers’ involvement in health coverage.
Originally published in: Health Affairs, v. 18, no. 6, November/December 1999, pp. 7-27.
This report is part of the RAND Corporation Reprint series. The Reprint was a product of the RAND Corporation from 1992 to 2011 that represented previously published journal articles, book chapters, and reports with the permission of the publisher. RAND reprints were formally reviewed in accordance with the publisher's editorial policy and compliant with RAND's rigorous quality assurance standards for quality and objectivity. For select current RAND journal articles, see External Publications.
This document and trademark(s) contained herein are protected by law. This representation of RAND intellectual property is provided for noncommercial use only. Unauthorized posting of this publication online is prohibited; linking directly to this product page is encouraged. Permission is required from RAND to reproduce, or reuse in another form, any of its research documents for commercial purposes. For information on reprint and reuse permissions, please visit www.rand.org/pubs/permissions.
The RAND Corporation is a nonprofit institution that helps improve policy and decisionmaking through research and analysis. RAND's publications do not necessarily reflect the opinions of its research clients and sponsors.