State of Michigan Department of Licensing and Regulatory Affairs Issues Michigan Annual Report on Group Employer Market Effects on HMOs as a Result of Increased Flexibility in Cost-Sharing Under MCL 500.3515

The State of Michigan Department of Licensing and Regulatory Affairs has issued the Michigan Annual Report on Group Employer Market Effects on HMOs as a Result of Increased Flexibility in Cost-Sharing Under MCL 500.3515.

Michigan Insurance Commissioner R. Kevin Clinton has determined that, for the calendar year ending December 31,2009:

a) Greater copayment and coinsurance levels allowed under PA 306 have not increased the number of employers who have contracted for HMO services.

b) Greater copayment and coinsurance levels allowed under PA 306 have not increased the number ofenrollees in the HMO employer group health benefit market.

c) HMOs have taken advantage ofthe flexibility of cost-sharing limits with the introduction of innovative products to create a market that is appealing to employers.

d) The experience of HMOs in the employer group health market may be a regional phenomenon.

Based on the above conclusions that are supported by the data and findings in this report, the Commissioner has determined that greater copayment and coinsurance levels allowed by the amendatory act that provided greater flexibility to HMOs in this area have not increased the number of employer groups and enrollees receiving health maintenance organization services.

However, HMOs have been developing products that take advantage ofthe flexibility in costsharing afforded by enactment of PA 306.

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