 Paying more for less? Insurer competition and health plan generosity in the Medicare Advantage programDaria Pelech Journal of Health Economics, 2018, vol. 61, issue C, 77-92 Abstract: This paper explores the relationship between insurer competition and health plan benefit generosity by examining the impact of a regulatory change that caused the cancellation of 40% of the private plans in Medicare. I isolate cancellation's causal effect by using variation induced by insurers canceling all plans nationally. Results show that insurers in markets affected by cancellation reduced the benefit generosity of the plans remaining in the market. In the average market, out-of-pocket costs for a representative beneficiary enrolled in plans not directly affected by the policy increased by $91 annually. In the least competitive markets, out-of-pocket costs increased by roughly $64–$127 a year for enrollees in those plans. Meanwhile in the most competitive markets, benefit generosity barely changed. These findings have crucial implications for markets such as health insurance exchanges, as they suggest that plan generosity is degraded when competition declines. Keywords: Health economics; Insurer competition; Health plan benefits; Medicare; Medicare Advantage (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:eee:jhecon:v:61:y:2018:i:c:p:77-92 DOI: 10.1016/j.jhealeco.2018.07.002 Access Statistics for this article Journal of Health Economics is currently edited by J. P. Newhouse, A. J. Culyer, R. Frank, K. Claxton and T. McGuire More articles in Journal of Health Economics from Elsevier |
Is your work missing from RePEc? Here is how to contribute.
Questions or problems? Check the EconPapers FAQ or send mail to .
EconPapers is hosted by the
School of Business at Örebro University.