Replication data for: Pricing and Welfare in Health Plan Choice
Principal Investigator(s): View help for Principal Investigator(s) M. Kate Bundorf; Jonathan Levin; Neale Mahoney
Version: View help for Version V1
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Project Citation:
Bundorf, M. Kate, Levin, Jonathan, and Mahoney, Neale. Replication data for: Pricing and Welfare in Health Plan Choice. Nashville, TN: American Economic Association [publisher], 2012. Ann Arbor, MI: Inter-university Consortium for Political and Social Research [distributor], 2019-10-11. https://doi.org/10.3886/E112566V1
Project Description
Summary:
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Premiums in health insurance markets frequently do not reflect individual differences in costs, either because consumers have private
information or because prices are not risk rated. This creates inefficiencies when consumers self-select into plans. We develop a simple econometric model to study this problem and estimate it using data on small employers. We find a welfare loss of 2-11 percent of coverage costs compared to what is feasible with risk rating. Only about one-quarter of this is due to inefficiently chosen uniform contribution levels. We also investigate the reclassification risk created by risk rating individual incremental premiums, finding only a modest welfare cost. (JEL G22, I13, I18)
Scope of Project
JEL Classification:
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G22 Insurance; Insurance Companies; Actuarial Studies
I13 Health Insurance, Public and Private
I18 Health: Government Policy; Regulation; Public Health
G22 Insurance; Insurance Companies; Actuarial Studies
I13 Health Insurance, Public and Private
I18 Health: Government Policy; Regulation; Public Health
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