 What are consumers willing to pay for a broad network health plan?: Evidence from covered CaliforniaColeman Drake Journal of Health Economics, 2019, vol. 65, issue C, 63-77 Abstract: Health Insurance Marketplaces have received considerable attention for their narrow network health plans. Yet, little is known about consumer tastes for network breadth and how they affect plan selection. I estimate demand for health plans in California’s Marketplace, Covered California. Using 2017 individual enrollment data and provider network directories, I develop a geospatial measure of network breadth that reflects the physical locations of households and network providers. I find that households are sensitive to network breath in their plan choices. Mean willingness to pay for a broad network plan relative to a narrow network plan, defined as a two standard deviation, 17.44 percentage point increase in network breadth, is $45.83 in post-subsidy monthly premiums. Variation in WTP indicates a selection mechanism exists whereby older households sort into broader network plans. I also find that households are highly premium sensitive, which may be a result of plan standardization in Covered California. Keywords: ACA; Health insurance marketplace; Covered California; Discrete choice; Health insurance; Provider network (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:65:y:2019:i:c:p:63-77 DOI: 10.1016/j.jhealeco.2018.12.003 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 |
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