The Shortcomings of Voluntarism in the Small-Group Insurance Market

Abstract

Prologue: America's reliance on voluntary solutions to vexing social problems is a theme that runs through its history. Private foundations are public trusts that society, in its search for volun- tary solutions, turns to for social experimentation and innova- tion. Sometimes foundations achieve success in their pursuits; often they do not. But whatever the outcome, most foundations do not evaluate their program efforts with the same energy and expenditure that was allocated for their design. Occasionally, though, foundations do put forth the extra effort, as this paper by Catherine McLaughlin and Wendy Zellers indicates. Along with colleague Lawrence D. Brown, the authors were enlisted by The Robert Wood Johnson Foundation to evaluate the re- sults of its Health Care for the Uninsured Program. In this paper, they underscore the challenge of structuring a set of in- centives that encourage people to change their behavior voluntar- ily-in this case, to buy health insurance. As a part of their ef- fort, they collected survey data in four of the nine program sites on the small businesses that offered health insurance to their em- ployees and those that did not. The data showed that useful pro- jects that reduced the number of working uninsured people were created in the four sites, but the evaluators also found that the market penetration ranged from 2 to 17 percent, with only one project in the double digits. Their conclusion: Larger efforts are required to make significant reductions in the number of people who lack health insurance. The Robert Wood Johnson Founda- tion retained McLaughlin and Brown several years ago to evalu- ate another of its efforts- t h e Community Programs for Afford- able Health Care-and their findings were published in Health