While the employer lobby has often taken the lead in opposing the patient's right to sue their health plan, the nation's smaller employers apparently do not share that position. Generally, the respondents were larger sized self-funded employers and, therefore, represent a bias toward bigger employers than was reflected in the broader KFF survey. The modest trend toward PPOs and away from the more closed panel and controlled HMOs was also found in the Mercer survey. Mercer found that PPOs grew from 35 percent to 43 percent. For example, PPOs often place hospitals at risk through the use of flat daily payments based upon the patient's diagnosis.
Larger employers fear consumer litigation given changing laws and the patient rights debate.
PPOs do not limit employers to closed panels that can expose the employer to charges of forcing the employee to use a certain physician. The HMOs themselves are making it easier for employers to offer PPO programs. HMOs are responding by offering open-access PPO products themselves that eliminate the gatekeeper provision. The same survey found an average employer increase of 6.2 percent in 1998. Mercer estimates that costs will climb an average of 7.5 percent in 2000.