The authors examine the premium consequences of alternative health insurance provisions by estimating pricing regressions for group insurance with data on 9, 019 fee-for-service plans offered by larger firms in the private sector. They find that cost-sharing at the point of purchase, especially for hospital care, significantly lowers fee-for-service premiums. However, some aspects of plan design that are often touted as cost-reducing, such as self-insuring or offering employees the option to join a health maintenance organization, are found to increase premiums. Coverage of alcoholism/chemical dependency treatments, inpatient mental health care, and psychologists' services, which are mandated in many states, are found to be expensive. Copyright 1990 by MIT Press.

We use a translog production function approach to examine the effects of medical staff physicians on hospital production, and how their effects differ in teaching and nonteaching hospitals. In teaching hospitals, we also focus on the special role of medical residents. We find that physicians have a strong positive influence on the productivity of other inputs, and that they are substitutes for other resources. Controlling for patient casemix causes significant changes in estimated marginal products; those of labor inputs increase and that of capital declines. The implications of our findings for policy are explored.