Genetic Adverse Selection: Evidence from Long-Term Care Insurance and Huntington Disease

Emily Oster, Ira Shoulson, Kimberly Quaid and E. Ray Dorsey

No 15326, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: Individual, personalized genetic information is increasingly available, leading to the possibility of greater adverse selection over time, particularly in individual-payer insurance markets; this selection could impact the viability of these markets. We use data on individuals at risk for Huntington disease (HD), a degenerative neurological disorder with significant effects on morbidity, to estimate adverse selection in long-term care insurance. We find strong evidence of adverse selection: individuals who carry the HD genetic mutation are up to 5 times as likely as the general population to own long-term care insurance. We use these estimates to make predictions about the future of this market as genetic information increases. We argue that even relatively limited increases in genetic information may threaten the viability of private long-term care insurance.

JEL-codes: D82 I11 I18 (search for similar items in EconPapers)
Date: 2009-09
New Economics Papers: this item is included in nep-cta, nep-hea and nep-ias
Note: EH LS PE
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Citations: View citations in EconPapers (3)

Published as Genetic Adverse Selection: Evidence from Long-Term Care Insurance and Huntington Disease (with Ray Dorsey et al) Journal of Public Economics, December 2010.

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Journal Article: Genetic adverse selection: Evidence from long-term care insurance and Huntington disease (2010)
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