Offsetting unexpected healthcare costs with futures contracts.
Group health insurance futures contracts will be traded at the Chicago Board of Trade in the near future. These contracts may be useful devices for capitated systems, such as health maintenance organizations (HMOs), to hedge unanticipated increases in the costs of providing health care. This article discusses how futures contracts may be used by an HMO to prevent financial losses that arise from unexpected increases in inpatient utilization.
James J. Nance College of Business, Cleveland State University, OH.
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Bond
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Marshall
D002641:Chicago; D003284:Contract Services; D006279:Health Maintenance Organizations / Q000191:economics*; D006301:Health Services Needs and Demand / Q000191:economics*; D015271:Insurance Pools / Q000191:economics*; D007449:Investments / Q000639:trends*; D012308:Risk Management; D012309:Risk-Taking; D014481:United States