Equilibria in Health Exchanges: Adverse Selection versus Reclassification Risk.
This paper studies regulated health insurance markets known as exchanges, motivated by the increasingly important role they play in both public and private insurance provision. We develop a framework that combines data on health outcomes and insurance plan choices for a population of insured individ...
| Publicado en: | Econometrica Vol. 83; no. 4; pp. 1261 - 1314 |
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| Autores principales: | , , |
| Formato: | Artículo |
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Wiley-Blackwell
Jul2015
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| Acceso en línea: | Ver este registro en EBSCOhost |
| fields | @attributes: recordID: 1 pdfLink: plink: https://search.ebscohost.com/login.aspx?direct=true&db=ssf&AN=108611421&site=ehost-live header: @attributes: shortDbName: ssf uiTerm: 108611421 longDbName: Social Sciences Full Text (H.W. Wilson) uiTag: AN controlInfo: bkinfo: jinfo: jid: 00129682 ECN jtl: Econometrica issn: 00129682 maglogo: Y pubinfo: dt: Jul2015 vid: 83 iid: 4 pid: 480 pub: Wiley-Blackwell artinfo: ui: 108611421 10.3982/ECTA12480 ppf: 1261 ppct: 53 formats: tig: atl: Equilibria in Health Exchanges: Adverse Selection versus Reclassification Risk. aug: au: Handel, Ben Hendel, Igal Whinston, Michael D. affil: Dept. of Economics, University of California at Berkeley Dept. of Economics, Northwestern University Dept. of Economics and Sloan School of Management, Massachusetts Institute of Technology su: Health insurance Insurance Public health Medical care Insurance premiums sug: subj: Health insurance Insurance Public health Medical care Third Party Administration of Insurance and Pension Funds Other Insurance Funds All Other Insurance Related Activities Direct individual life, health and medical insurance carriers Direct group life, health and medical insurance carriers Health and Welfare Funds Insurance premiums keyword: adverse selection Insurance exchanges reclassification risk adverse selection Insurance exchanges reclassification risk ab: This paper studies regulated health insurance markets known as exchanges, motivated by the increasingly important role they play in both public and private insurance provision. We develop a framework that combines data on health outcomes and insurance plan choices for a population of insured individuals with a model of a competitive insurance exchange to predict outcomes under different exchange designs. We apply this framework to examine the effects of regulations that govern insurers' ability to use health status information in pricing. We investigate the welfare implications of these regulations with an emphasis on two potential sources of inefficiency: (i) adverse selection and (ii) premium reclassification risk. We find substantial adverse selection leading to full unraveling of our simulated exchange, even when age can be priced. While the welfare cost of adverse selection is substantial when health status cannot be priced, that of reclassification risk is five times larger when insurers can price based on some health status information. We investigate several extensions including (i) contract design regulation, (ii) self-insurance through saving and borrowing, and (iii) insurer risk adjustment transfers. pubtype: Academic Journal doctype: Article src: R language: English refInfo: copyright: @attributes: flag: N holdings: @attributes: islocal: N |
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