1 The Provision of Private Health Insurance in Jordan: The HIPS Survey of Private Sector Firms September 00 Prepared by: Dwayne Banks, Ph.D. Abt Associates Inc. Hanann Riad Sabri, Ph.D. Abt Associates Inc. Hala Darwazeh, BSc Abt Associates Inc. Hanan Toukan, BA Abt Associates Inc. Manal Shahrouri, BSc Abt Associates Inc. Partners for Health Reform Plus Project Abt Associates Inc. 800 Montgomery Lane, Suite 600 Bethesda, Maryland 08 Tel: 0/ Fax: 0/65-96 In collaboration with: Development Associates, Inc. Emory University Rollins School of Public Health Philoxenia International Travel, Inc. Program for Appropriate Training in Health SAG Corporation Social Sectors Development Strategies, Inc. Training Resource Group Tulane University School of Public Health and Tropical Medicine University Research Co., LLC. Funded by: U.S. Agency for International Development Report. PHRplus Jordan,
2 Table of Contents Acknowledgements.5. Executive Summary 6. Background.0. Data Methodology and Issues. The Sample Frame.... Supervision and Field Work. Data Entry and Cleaning... Profile of Health Insurance Coverage 5. Profile of Health Care Plans Offered.0 6. Firm t Offering Health Insurance and The Views of Their Uninsured Employees 6 7. Conclusion Appendix A: Health Insurance in the Private Sector Survey (HIPS) Survey Instrument.. Table of Figures Exhibit : Distribution of Firms in Amman by Sector Figure : Percentage of Firms Offering Health Insurance, by Sector... Figure A: Percentage of Self-insured Firms by Sector.. Figure B: Percentage of Self-insured Firms by Size. Figure : Percentage of Firms Offering Health Insurance in the Health & Education Sector..5 Figure : Percentage of Firms Offering Health Insurance in the Manufacturing Sector. 5 Figure : Percentage of Insured Employees in Each Sector. 6 Figure 5: Percentage of Insured Employees in the Health & Education Sector...7 Figure 6: Percentage of Insured Employees by Size of Firms..7 Figure 7: Average Size of Insured and n-insured Firms, by Sector..8 Figure 8: Distribution of Firms in Amman by, Sector..9 Figure 8 A: Distribution of Firms Offering Health Insurance in Amman 9
3 Figure 9: Percentage of Firms Offering Health Insurance Coverage to the Dependents Of their Employees, by Sector... 0 Figure 9 A: Percentage of Firms Covering in and Outpatient Health Services for Employees and their Dependents... Figure 0: Type of Health Insurance Provided by Firms in Each Sector. Figure : Percentage of Firms Offering the Same Health Insurance Plans to Employees, by Sector... Figure : Conditions Covered Under Health Insurance Plan.. Figure : Percentage of Firms that Place a Ceiling on the Consumption of Health Care Services Figure : Percentage of Firms that Have a Specified Network of Providers, by Sector...5 Table : Most Often Cited Reasons for t Providing Health Insurance Coverage.. 6 Table : Most Often Cited Reasons, by Employees, for Purchasing MOH Voluntary Health Insurance 7 Table : Labor Distribution of Employees That are Willing to Purchase MOH Voluntary Health Insurance 7 Table : Most Often Cited Reasons, by Employees, for t Purchasing MOH Voluntary Health Insurance 8 Acknowledgements The United States Agency for International Development (USAID) has made this study possible. We express our sincerest gratitude to His Excellency the Minister of Health, Dr. Faleh Al Nasser and his predecessors for supporting and sustaining this effort. We thank the Department of Statistics (DOS) for providing the sample frame for this survey. In addition, we extend our appreciation to the PHR Ministry of Health Counterparts (Dr. Taher Abu Samen, Dr. Hani Brosk, Dr. Ayyoub S.K. As-Sayaideh, Dr. Abdel Razzaq S.H. Shafei, Dr. Taissir Fardous, and Dr. Jamal A.A. Abu Saif) for their commitment and efforts in implementing health care reform in Jordan. Finally, we would like to thank Dr Mustafa Hamarneh from the Center of Strategic Studies, at the University of Jordan, and the data collection team (Nawal Al-Amaireh, Mohammad Hakouz, Abeer Hiyari, Intissar Khreisat, Jamil Saleh and Sawsan Wadi) for their hard
4 work and dedication. Special thanks to Mrs. Rasha C. Ghannoum for her editorial assistance.
5 . Executive Summary This report summarizes findings from the Health Insurance In The Private Sector (HIPS) survey that was implemented by the Partnerships for Health Reform (PHR) project, Amman Jordan, during the month of June 999. The survey covered 500 private sector firms located in Amman, the nation s capital. Amman is home to over 70 percent of all private sector establishments. In addition, all large firms are headquartered in Amman even though their production facilities may be located in other regions of the country. This allowed for the inclusion of firms in the sample frame, whose production facilities were located outside of Amman. Hence, the geographical coverage of the survey extended far beyond the capital city. The HIPS survey is part of a series of studies aimed at assisting the Ministry of Health (MOH), of the Hashemite Kingdom of Jordan, in implementing comprehensive health insurance reform. Other technical assistance in this area has been as follows: April 998: Convened a round table discussion with the Minister of Health (Dr. Ashraf Kurdi), and other senior level public and private sector officials on establishing guidelines for implementing health insurance reform in Jordan. April 998: Conducted a survey of private health insurance companies in Jordan. vember 998: Workshop held for exploring the issues and options to consider when designing health insurance coverage for the uninsured in Jordan. June 999: Focus groups conducted, for measuring consumers willingness to purchase MOH sponsored voluntary health insurance, in addition to obtaining information on the public s perception of MOH service quality. July 999: A comprehensive profile of the uninsured Jordanian population was conducted. This study highlighted the demographic attributes and geographical distribution of uninsured persons in the Kingdom. 5 August 000: A national survey of 8,800 households, over 9,500 individuals (the Jordan Health Utilization and Expenditure Survey), completed 0 December 000 by the Department of Statistics on behalf of PHR. The HIPS survey is of import for at least two reasons. Firstly, nearly 6 percent of the labor force are employed in the private sector 6, most of whom are ineligible for See, Judith Feder and Alan Fairbank, Steps Toward Universal Health Insurance in Jordan, May 7, 998, PHR Trip Report. See, Neil Hollander and Margie Rauch, Assessment of Third Party Payors in Jordan, Technical Report. 7, Partnerships for Health Reform, October 998. See, Dwayne Banks, Catherine Connor, Alan Fairbank, Gary Gaumer, and Narmine Sindaha Muna, Workshop on Insuring the Uninsured in Jordan, PHR Summary Proceedings, Partnerships for Health Reform, See, Dwayne A. Banks, Narmine Sindaha Muna, and Tahani A. Shahrouri, Consumers Willingess to Pay for MOH-Sponsored Voluntary Health Insurance in Jordan: A Focus Group Analysis, Technical Report., Partnerships for Health Reform, October See, Dwayne A. Banks, Lonna Milburn and Hannan Sabri, Profile of the Uninsured in Jordan, Technical Report. 7, Partnerships for Health Reform, September Department of Statistics (DOS), Employment Survey, 996 5
6 public sector health insurance. Currently, public sector health insurance covers Civil Servants, military personnel, and public safety personnel. 7 Individuals employed in the private sector, therefore, rely upon high priced private sector services, or highly subsidized MOH safety-net services. The former may impose a significant financial burden on these individuals, while the latter may imposes a significant cost burden on the government. 8 Secondly, the vast majority of uninsured persons reside in households in which the head of household is an employed person. 9 Hence, obtaining a comprehensive assessment of the provision of employer-sponsored health insurance, to workers and their dependents, will provide the MOH with baseline information for estimating the potential demand for MOH sponsored voluntary health insurance. The potential demand for a MOH-sponsored health insurance plan, as well as benefits package design, vis-à-vis dependent coverage, will be highly influenced by the health insurance needs for this segment of the population. Finally, an essential component of the survey consist of a series of open-ended questions detailing the conditions for which uninsured-employed persons would consider purchasing MOH sponsored voluntary health insurance. Below we summarize the most substantive findings from the survey: What level of health insurance coverage exists among private sector firms? Fourteen percent of all firms interviewed offered health insurance coverage to their employees. The banking sector exhibits the highest percentage (00 percent), followed by the transportation sector (8 percent), and the health and education sector ( percent). A disproportionately low number of firms in the manufacturing and retail sectors offered health insurance coverage to their employees, percent and percent, respectively. Thirty-three percent of firms offering health insurance are self-insured. 0 The remaining 67 percent purchase their insurance through commercial insurers. Forty-seven percent of all workers are covered by employer-sponsored health insurance. The largest percentage of insured workers are those employed in the banking sector (85 percent). The health and education, and manufacturing sectors cover 57 percent, and 5 percent of their employees, respectively. Larger firms are more likely to provide health insurance to their employees than are smaller ones. The average size of firms that offer health insurance is 9 employees, versus 8 employees for firms that do not. This size effect is 7 The exception being individuals with end-stage renal disease, and other selected chronic conditions. 8 The cost burden that might be imposed on the government results from individuals consuming MOH sponsored services without contributing to the system. For example, Civil Service employees pay a share of their monthly salary into a health insurance fund. Others who have not contributed this monthly amount, such as individuals employed in the private sector, may still consume MOH services at highly subsidized rates. This effectively establishes a system whereby public sector employees are cross-subsidizing the treatment of privately employed and non-employed persons. 9 Dwayne A. Banks, Lonna Milburn, and Hanann Sabri, Profile of the Uninsured in Jordan, Technical Report. 7, Partnerships for Health Reform, September Self-insured firms are firms that finance the total cost of their employer-sponsored health insurance plans. Such firms typically collect a monthly contribution from employees; however, the total cost of coverage is paid for out of the firm s health insurance fund. In addition, self-insured firms typically contract out the administration of their health plans to Third Party Administrators (TPAs). There exists three TPAs in Jordan: Medical Arab German Insurance Network, Mednet, and National Health Insurance Administration Company (NatHealth). 6
7 evident, when one considers that percent of firms surveyed, provided health insurance coverage to 7 percent of all workers. Firms located in West Amman are more likely to offer health insurance coverage to their employees, relative to firms located in East and Outer Amman. In fact, 6 percent of firms offering health insurance are located in West Amman, compared to percent and percent in East and Outer Amman, respectively. What type of health insurance is being provided by private sector firms? Sixty-one percent of firms that offer health insurance, offer it as part of a comprehensive employee s benefit package. In other words, coverage is compulsory. The remaining 9 percent offer it as an optional benefit. Sixty-two percent of firms that offer health insurance benefits cover employees and their dependents. Firms in the banking and transportation sectors are more likely to cover dependents, than are firms in other sectors of the economy. Of the firms that offer health insurance to their employees, a majority provides comprehensive benefits to both employees and dependents. For example, over 90 percent of these firms offer plans that cover hospitalization, doctors visits, medications, laboratory tests, and x-rays -- for both employees and dependents. Moreover, 90 percent of firms offering comprehensive benefits cover at least 80 percent of the total cost of treatment. Fifty percent of firms place limits (ceilings or caps) on the total amount they are willing to pay for health care services. In fact, 6 percent place caps (ceilings) on inpatient services, percent on doctors visits, 8 percent on medication and 6 percent on laboratory tests and x-rays. The average ceiling amounts per annum are JD075, JD8, JD00, and JD00 respectively. Seventy-five percent of firms offering health insurance to their employees have a specified network of providers, from which employees and their dependents must select from. In most cases, this network includes specific hospitals, doctors, pharmacies and laboratories. Fifty-one percent of firms require that employees contribute a nominal amount towards their health insurance plans. Of those plans that offer dependent coverage, seven percent require that their employees pay an additional amount for dependent coverage. Sixty-six percent of firms offering health insurance pay a contribution towards their employees' health insurance plans. The average annual contribution is approximately JD65 per employee. Is the private sector interested in purchasing government-sponsored health insurance? Sixty-eight percent of firms that do not offer health insurance are interested in purchasing government health insurance. However, percent of these firms would do so only if the price were reasonable, and the quality of services increased. 7
8 Eighty percent of employees working in firms that do not offer health insurance are interested in purchasing government health insurance. Their main reason for doing so is to reduce their out-of-pocket expenditures on health care services. On average, employees are willing to pay JD8 per month for government sponsored health insurance. Moreover, for 9 percent of employees, this figure includes dependent coverage as well. Conclusion As illustrated in this document, nearly 5 percent of workers in the private sector are without any form of employer-sponsored health insurance. Individuals fortunate enough to have such coverage, are employed primarily in the largest most affluent companies in the Kingdom. These workers, for the most part, are provided with a comprehensive array of health care services, from physician and hospital services to lab test and medications. While there exists some variation in the placement of expenditure limits, penalties for using none network providers, services covered, extent of care for dependents, and out-of-pocket expenditures; however, the majority of employer-sponsored health care plans are quite generous in their scope of services. Unfortunately, the firms providing such plans represent only percent of companies operating in the Kingdom. The vast majority of firms (i.e., those that do not offer health insurance to employees) are small to medium size firms, employing low to medium wage earners, and have limited revenue-generating capacity. While they overwhelmingly support the concept of assuring access to health care services for their employees, the vast majority indicate that it is economically infeasible for them to do so. They cite a number of interrelated factors that preclude them from offering such benefits. Finally, the interplay between health insurance coverage, firm size, and the relative income of the company and its employees is a very complicated one, indeed. As the government seeks to expand health insurance coverage to the population, whether through a voluntary or compulsory scheme, the issues at hand must be seriously debated and policies must be gradually phased-in. For example, whether voluntary or compulsory, a company or individual s ability to participate, or the government s ability to generate enough revenue to make the system sustainable, is determined by the ability of both the company and individual to pay. Furthermore, any mandated policy, such as an employer-mandate, must determine beforehand. The categories of employees and companies to impose the mandate upon must be determined, as well as other factors, such as dependent coverage. For example, imposing an employer-mandate upon full-time workers may cause some companies to reduce the work hours for this category of employees such that they become ineligible for participation. Alternatively, allowing for voluntary participation would require differential treatment of full-time versus part-time employee, as well as high wage earners versus low-wage earners. In other words, who should subsidize whom will have to be seriously debated. In any event, the information contained within this report should assist current and future governments in determining optimal health care policy design in Jordan. 8
9 . Background The Partnerships for Health Reform (PHR) project is providing long-term technical assistance to the Jordanian Ministry of Health (MOH) in the fields of health financing and management, in order to improve the efficiency, equity and sustainability of the Jordanian health care sector. One major area of concern is that of universal health insurance coverage. The MOH has expressed keen interest in expanding formal health insurance coverage to the estimated.9 million uninsured Jordanian residents (0 percent of the population). Moreover, while 6 percent of the workforce are in the private sector, a disproportionately low number of private sector firms actually offer health insurance coverage to their employees. The MOH is therefore considering the possibility of extending health insurance to private sector employees, through an employer-sponsored health insurance schemes or through individually purchased health insurance plans. Prior to adopting either policy option, the government needs to assess the current state of private health insurance provision, vis-à-vis the public sector, as well as the interest of private sector employees in purchasing MOH sponsored health insurance. The private health insurance market, currently covering approximately.6 percent of Jordanians, is becoming an ever-increasing source of health care financing within the country. Therefore, it is imperative for the Jordanian government to obtain a comprehensive assessment of the pattern, level and category of health insurance being provided by this segment of the economy. Equally important, however, is the need to identify areas where private sector participation would be most useful in the design of a comprehensive national health insurance policy. Finally, a significant information gap exist, concerning the contribution of private sector firms to the national strategy of providing comprehensive health insurance coverage to the population. It is our hope that the information contained within this report will fill such gaps, by stimulating dialogue between the public and private sectors. To accomplish the aforementioned objectives, the survey investigated the level and pattern of health insurance among 500 randomly selected private sector firms, of various economic activities, as well as their interest in purchasing government sponsored voluntary health insurance. In addition, the study is an extension of a previous PHR Jordan survey conducted in September of 998. That study focused on assessing the provision of private health insurance, among the population of Jordanian shareholding companies (i.e., the population of companies listed on the Jordanian stock exchange). That study provided the government of Jordan with a comprehensive assessment of the incidence and scope of health insurance provided to employees working within these firms. Shareholding companies have greater access to capital markets, and are therefore more likely than other companies to provide such coverage to their employees. See Jordan Health Care and Expenditure Survey 000 (JHUES). This survey of over 9,500 individuals was funded by the United States Agency for International Development, under the PHR Jordan program. PHR Jordan designed the survey instrument, and contracted with the Department of Statistics (DOS) for the field implementation of this survey. Personnel from the US Bureau of the Census designed the sample frame for the survey. The JHUES constitutes the first, and most comprehensive health care expenditure and utilization survey conducted in Jordan. Op. Cite, JHUES, 000. Dwayne A. Banks, Hannan R.Sabri and Hala Darwazeh, Health Insurance Coverage Among Jordanian Shareholding Companies, PHR Jordan Report, April 0,
10 . Data Methodology and Issues. The Sample Frame The results of this survey were based upon information obtained from a sample frame of private sector firms, provided to PHR by the Department of Statistics of the Hashemite Kingdom of Jordan. The Health Insurance In The Private Sector survey (HIPS), as the name implies, captured data on a variety of employer-sponsored health insurance issues, most notably the incidence (distribution) and scope (level and quality) of health insurance provision among private sector companies. The survey instrument is contained in Appendix A of this report. The HIPS sample frame consisted of 700 private sector firms in Amman and the greater Amman governorate, 5 with a response rate of 7 percent, thereby leading to completed surveys on 500 companies. 6 This far exceeded the estimated sample size of 50 firms. All interviews were conducted during the month of June 999, and to this date the HIPS constitutes the most comprehensive survey of employer-sponsored health insurance in Jordan. For those companies not providing health insurance to their employees, the HIPS investigates their interest in purchasing MOH-sponsored voluntary health insurance on their behalf. Within these same firms, two employees, a low- and high-wage earner, were interviewed to assess their willingness to purchase MOH-sponsored voluntary health insurance through their employer. This resulted in obtaining survey information from 800 such workers. Hence, the HIPS survey consisted of a survey of 500 companies, as well as a supplemental survey of 800 employees.. Supervision and Field Work The HIPS Team consisted of a Survey Director, Assistant Director, eight fulltime interviewers, one full-time Field Supervisor and two full-time Field Coordinators. The interviewers and Field Supervisor had extensive experience in conducting surveys in Jordan, and were hired through the Center for Strategic Studies at the University of Jordan. Other personnel were full-time PHR staff members. Interviewers received comprehensive training on the objectives of the survey, its structure, map reading, interviewing methods, and field data verification methods. Upon completion of this training, the survey instrument was pre-tested, and the interviewers received post-pilot training. The Survey Director and Assistant Director provided senior level management and expertise to the overall design and implementation of the survey. The Field Supervisor, along with assistance from the Field Coordinators, provided overall field supervision to interviewers, as well as field verification of all data compiled. The sample was stratified according to the Department of Statistics method for stratifying economic establishments in Jordan. This assured a statistically valid representation of both small (five employees or less) and large firms (twenty-five employees or more). 5 Original estimates indicated that a sample frame of 50 firms were required, however, at the suggestion of statisticians at the DOS the sample frame was doubled to take into account the attrition of firms in the market. This led ultimately to interviews being conducted on 500 firms, out of a sample frame of Methods of probability by proportionate sampling (PPS) were conducted, to arrive at a representative sample of firms from various industries. Hence, all major industries were represented in the sample. 0
11 . Data Entry and Cleaning The two field coordinators, under the supervision of the Survey Director and Assistant Director, were responsible for inputting, coding, and performing consistency checks on all data. All survey information was double entered for consistency. All data was prepared as SPSS (Statistical Package for the Social Sciences) data files. Cross-tabulations were performed against various variables, in an attempt to check for inconsistencies in coding as well as data entry, during the final stages of data preparation. The data was disaggregated by the following industrial categories: manufacturing, retail, banking, transportation, insurance, contracting, consulting, hotels, restaurants, entertainment, education, health and other services. Forty-five percent and 0 percent of firms were located in East and West Amman, respectively. The remaining 5 percent were located in Outer Amman. Exhibit depicts the percentage distribution of firms, by industrial classification and location (East, West and Outer Amman), that comprised our sample of 500 companies. Exhibit : Distribution of Firms in Amman by Sector 00% 90% 80% 70% Percentage (%) 60% 50% 0% Outer West East 0% 0% 0% 0% Manufacturing Retail Banking Transport Insurance, Contracting & Consulting Hotels, Restaurants & Entertainment Education & Health Other Services Sector As illustrated in Exhibit, 56 percent,, percent and percent of manufacturing firms surveyed were located in East, West and Outer Amman, respectively. This includes firms that are located in the Qualified Industrial Zone of Sahob. Fifty-three percent, percent and 6 percent of retail establishments surveyed are located in East, West and Outer Amman, respectively. One hundred percent of banks surveyed were located in West Amman. West Amman is the headquarters of all banking establishments in Jordan. All human resource issues, in particular the provision of employee benefits, are centrally determined. Eighty-nine percent and percent of firms engaged in the transportation sectors were located in West, and East Amman, respectively. Eight-seven percent and percent of surveyed firms that are engaged in insurance, contracting and consulting were located in West and East Amman, respectively. Fifty-nine percent, 7 percent and percent of firms classified as hotels, restaurants and entertainment establishments were located in West, East and Outer Amman, respectively. Fifty-four percent, percent and 5 percent of education and health establishments were located West, East and Outer Amman, respectively. Finally, 5 percent, percent and 5 percent of firms classified as other services were located in East, West and Outer Amman, respectively.
12 . Profile of Health Insurance Coverage Figure : Percentage of Firms Offering Health Insurance by Sector 0% 00% 80% Percentage (%) 60% 0% 0% 0% Manufacturing Retail Banking Transport Insurance, Contracting & Consulting Hotels, Restaurants & Entertainment Education & Health Other Services Sector As can be depicted in Figure, the banking sector by far exhibits the highest level of health insurance coverage. In fact, 00 percent of banks interviewed offered health insurance coverage to their employees. There exist several explanations for the high level of health insurance coverage found among banks in Jordan. Firstly, banks typically have greater access to capital markets and higher net revenues, relative to other categories of firms in Jordan. Hence, they are better able to offset the cost of providing this additional benefit to their employees. Finally, the banking sector competitively recruits highly qualified, managerial, finance and accounting personnel. Therefore, providing health insurance as part of a comprehensive employee s benefits package is often used as a devise for recruiting and retaining highly skilled personnel. Moreover, as observed in Figure A, 50 percent of banks, 60 percent of insurance, contracting and consulting firms, and 56 percent of education and health related firms are self-insured organizations. These figures far exceeds that found in other sectors of the economy. Figure A: Percentage of Self-insured Firms by Sector 00% 90% 80% 70% Percentage (%) 60% 50% 0% Commercially insured Self-insured 0% 0% 0% 0% Manufacturing Retail Banking Transport Insurance, Hotels, Contracting & Restaurants & Consulting Entertainment Sector Education & Health Other Services
13 Hence, banks, like other self-insured firms, are likely to find it economically and administratively more feasible to provide health insurance as part of employees compensation packages. This is likely the case given that self-insured firms, due to their size and employees health status, may realize significant gains through risk pooling. 7 As illustrated in Figure B, self-insured firms are likely to be the largest of firms in a particular sector. For example, nearly 6 percent of firms with 5 to 9 employees and roughly 9 percent of firms with 00 to 700 employees are self-insured. This is in contrast to 00 percent of smaller firms (those with less than 5 employees) that are insured by commercial health insurance companies. However, what is most interesting is the fact that only 5 percent of firms sized employees are self-insured. Hence, it appears that the decision for self-insuring among firms is not only associated with size, but also with the firm s industrial classification and overall earnings. In fact, the firms that are observed as being self-insured are the higher revenue firms such as banks, shareholding companies, and large quasi-governmental manufacturing organizations (e.g., Jordan Petroleum). Figure B: Percentage of Self-insured Firms by Size 00% 90% 80% 70% Percentage (%) 60% 50% 0% Commercially insured Self-insured 0% 0% 0% 0% - emp 5-9 emp 0- emp 5-9 emp emp emp Size of Firms Moreover, compared to the banking sector, other sectors provide health insurance at a significantly lower rate. For instance, as illustrated in Figure, roughly 8 percent of firms in the transport sector offer health insurance coverage to their employees. This sector of the economy consists primarily of large shipping companies, as well as several international airline companies. The rate for firms in other sectors is significantly lower: education and health, commercial health insurance companies, contracting and consulting, services (i.e., hotels, restaurants, and entertainment), manufacturing and retail sectors, were percent, 7 percent, percent, percent and percent, respectively. Furthermore, and most surprising is the low-level of multinational firms that offer health insurance to their employees. Slightly more than 0 percent of multi-national firms, conducting business in Jordan, provide health insurance coverage to their employees. This is in contrast to 9 percent of Jordanian firms that are engaged in international commerce. 7 Risk-pooling allows firms with large numbers of employees, and hence, greater variation in health status of employees to collect employee contributions in amounts greater than that of the claims which are paid out to providers. Self-insured firms may chose to administer their health funds through the use of a Third Party Administrator (TPA).