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December, 1988, Vol. 111, No. 12

Disability and insurance plans
in the public and private sectors

Allan P. Blostin, Thomas P. Burke and Lora M. Lovejoy

Both private industry employers and State and local governments include in their employee benefits packages health and life insurance and protection against income loss because of disability. Plan details, however, often differ between the two sectors. This article examines these differences by comparing findings of the Bureau of Labor Statistics most recent employee benefits survey of medium and large firms in the Nation's private industries—conducted in 1986—and its 1987 employee benefits survey of State and local governments, the first in the public sector.¹

The discussion covers the major employee disability and insurance benefits: health care and life insurance, and plans providing disability income, such as paid sick leave, sickness and accident insurance, and long-term disability insurance.

Data for full-time workers in medium and large firms in private industry are compared with those for three groups of full-time government workers—"regular" employees, teachers, and police and firefighters. (Regular employees are all workers except teachers, police officers, and firefighters.) This classification of government workers shows differences in compensation practices for the three occupational groups.

Because insurance and disability benefits have evolved over the years, a comparison of 1986 and 1987 survey findings may be incomplete. For example, the higher participation in health maintenance organization (HMO) plans among State and local government workers (24 percent were enrolled in 1987) than among workers in private industry (13 percent in 1986) is caused in part by the overall growth in HMO enrollments between 1986 and 1987. Furthermore, such insurance plan provisions as deductibles² and employee premium contributions are often amended in line with increases in wages and prices.³

This excerpt is from an article published in the June 1988 issue of the Monthly Labor Review. The full text of the article is available in Adobe Acrobat's Portable Document Format (PDF). See How to view a PDF file for more information.

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Footnote

1 Industrial coverage of the private sector survey included mining; construction; manufacturing; transportation, communications, electric, gas, and sanitary services; wholesale trade; retail trade; finance, insurance, and real estate and selected services. Major findings of the 1986 survey are reported in Employee Benefits in Medium and Large Firms, 1986, Bulletin 2281 (Bureau of Labor Statistics, 1987).
  Local governments surveyed included general administrative units; hospitals, nursing homes, and outpatient clinics; elementary and secondary schools, and colleges and universities; and water and sewage authorities, park districts, transportation districts, and so forth. Major findings of the 1987 survey are reported in Employee Benefits in State and Local Governments, 1987, Bulletin 2309 (Bureau of Labor Statistics, 1988).

2 A deductible is a specified amount of expense that an insured person must pay before benefits will be paid by the plan.

3 A limited test was made of the relation between changes in the medical care component of the Consumer Price Index for All Urban Consumers (CPI-U) and in such health insurance provisions as employee contribution rates and overall maximum limits on dollar benefits. Although all the series examined moved upward overtime, the year-to-year changes were not sufficiently close to allow adjustment of the 1986 provisions by the 1986-87 CPI changes in order to improve the comparability of the private and public sector findings.

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