The Resource Adverse selection and switching costs in health insurance markets : when nudging hurts, Benjamin R. Handel, (electronic resource)

Adverse selection and switching costs in health insurance markets : when nudging hurts, Benjamin R. Handel, (electronic resource)

Label
Adverse selection and switching costs in health insurance markets : when nudging hurts
Title
Adverse selection and switching costs in health insurance markets
Title remainder
when nudging hurts
Statement of responsibility
Benjamin R. Handel
Creator
Contributor
Subject
Language
eng
Summary
This paper investigates consumer switching costs in the context of health insurance markets, where adverse selection is a potential concern. Though previous work has studied these phenomena in isolation, they interact in a way that directly impacts market outcomes and consumer welfare. Our identification strategy leverages a unique natural experiment that occurred at a large firm where we also observe individual-level panel data on health insurance choices and medical claims. We present descriptive results to show that (i) switching costs are large and (ii) adverse selection is present. To formalize this analysis we develop and estimate a choice model that jointly quantifies switching costs, risk preferences, and ex ante health risk. We use these estimates to study the welfare impact of an information provision policy that nudges consumers toward better decisions by reducing switching costs. This policy increases welfare in a naive setting where insurance plan prices are held fixed. However, when insurance prices change endogenously to reflect updated enrollee risk pools, the same policy substantially exacerbates adverse selection and reduces consumer welfare, doubling the existing welfare loss from adverse selection
Member of
Cataloging source
OUN
Illustrations
illustrations
Index
no index present
Literary form
non fiction
Nature of contents
  • dictionaries
  • bibliography
Series statement
NBER working paper series
Series volume
no. 17459
Label
Adverse selection and switching costs in health insurance markets : when nudging hurts, Benjamin R. Handel, (electronic resource)
Link
http://ezproxy.eui.eu/login?url=http://papers.nber.org/papers/
Instantiates
Publication
Copyright
Note
  • Title from http://www.nber.org/papers/17459 viewed Sept. 26, 2011
  • "September 2011."
Bibliography note
Includes bibliographical references (pages 35-37)
Carrier category
online resource
Carrier category code
cr
Carrier MARC source
rdacarrier.
Content category
text
Content type code
txt
Content type MARC source
rdacontent.
Control code
FIEb17170837
Extent
1 online resource (64 pages)
Form of item
online
Media category
computer
Media MARC source
rdamedia.
Media type code
c
Other physical details
illustrations.
Specific material designation
remote
System control number
(OCoLC)754655680
Label
Adverse selection and switching costs in health insurance markets : when nudging hurts, Benjamin R. Handel, (electronic resource)
Link
http://ezproxy.eui.eu/login?url=http://papers.nber.org/papers/
Publication
Copyright
Note
  • Title from http://www.nber.org/papers/17459 viewed Sept. 26, 2011
  • "September 2011."
Bibliography note
Includes bibliographical references (pages 35-37)
Carrier category
online resource
Carrier category code
cr
Carrier MARC source
rdacarrier.
Content category
text
Content type code
txt
Content type MARC source
rdacontent.
Control code
FIEb17170837
Extent
1 online resource (64 pages)
Form of item
online
Media category
computer
Media MARC source
rdamedia.
Media type code
c
Other physical details
illustrations.
Specific material designation
remote
System control number
(OCoLC)754655680

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