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American Economic Review: Vol. 102 No. 3 (May 2012)

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Health Reform, Health Insurance, and Selection: Estimating Selection into Health Insurance Using the Massachusetts Health Reform

Article Citation

Hackmann, Martin B., Jonathan T. Kolstad, and Amanda E. Kowalski. 2012. "Health Reform, Health Insurance, and Selection: Estimating Selection into Health Insurance Using the Massachusetts Health Reform." American Economic Review, 102(3): 498-501.

DOI: 10.1257/aer.102.3.498

Abstract

We implement an empirical test for selection into health insurance using changes in coverage induced by the introduction of mandated health insurance in Massachusetts. Our test examines changes in the cost of the newly insured relative to those who were insured prior to the reform. We find that counties with larger increases in insurance coverage over the reform period face the smallest increase in average hospital costs for the insured population, consistent with adverse selection into insurance before the reform. Additional results, incorporating cross-state variation and data on health measures, provide further evidence for adverse selection.

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Authors

Hackmann, Martin B. (Yale U)
Kolstad, Jonathan T. (U PA)
Kowalski, Amanda E. (Yale U)

JEL Classifications

G22: Insurance; Insurance Companies
I18: Health: Government Policy; Regulation; Public Health
H75: State and Local Government: Health; Education; Welfare; Public Pensions
I13: Health Insurance, Public and Private


American Economic Review


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