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Employers As Purchasers

PROLOGUE

Employers As Purchasers

PROLOGUE: It is by now well understood that while insurers and HMOs were the most visible agents of the managed care restructuring of the 1990s, the demand for change came largely from employers, who were shocked out of their traditional passivity toward health benefits when cost increases began accelerating in the 1980s.

After being temporarily beaten into submission, problematic cost increases have reemerged. Employers’ freedom to crack down on costs, by either reducing benefits or increasing cost sharing, has been limited by a tight labor market. But in a weakening economy, with rising unemployment, this constraint has begun to ease. . . . [Full Text of this Article]

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