Switching costs in competitive health insurance markets

Karine Lamiraud

No WP1305, ESSEC Working Papers from ESSEC Research Center, ESSEC Business School

Abstract: In this paper we investigate the possible presence of switching costs when consumers are offered the opportunity to change their basic health insurance provider. We focus on the specific case of Switzerland which implemented a pure form of competition in basic health insurance markets. We identify several barriers to switching, namely choice overload, status quo bias, the possession of supplementary contracts for enrollees in bad health, firm’s pricing strategies based on providing low price supplementary products, poor regulation of reserves and the limitations of the previous risk-equalization mechanism which left room for risk selection practices.

Keywords: Brand loyalty; Choice overload; Competition among health insurers; Status quo bias; Supplementary health insurance; Switching costs; The Swiss case (search for similar items in EconPapers)
JEL-codes: D41 G22 I13 (search for similar items in EconPapers)
Pages: 15 pages
Date: 2013-02
New Economics Papers: this item is included in nep-com, nep-hea and nep-ias
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

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Related works:
Working Paper: Switching costs in competitive health insurance markets (2013)
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Persistent link: https://EconPapers.repec.org/RePEc:ebg:essewp:dr-13005

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