The US Health Insurance Market: Performance and Efficiency Analyses

Patrick Brockett (), Linda Golden (), Charles C. Yang (), Boyi Zhuang () and Etti Baranoff ()
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Patrick Brockett: University of Texas at Austin
Linda Golden: University of Texas at Austin
Charles C. Yang: Florida Atlantic University
Boyi Zhuang: University of Alabama
Etti Baranoff: Virginia Commonwealth University

A chapter in Handbook of Insurance, 2025, pp 533-553 from Springer

Abstract: Abstract This chapter presents an overview of the US health insurance market, reviews health insurance research literature, and examines premiums, medical expenses, medical service utilization, and data envelopment analysis (DEA) efficiency measures of health insurers from different perspectives. Results indicate the Affordable Care Act (ACA), or Obamacare, bent the curve of medical cost increases downward. Another finding is that medical expense increase was due to medical service utilization increase instead of service price increase. Among states, we find inconsistency existed in medical service pricing. Efficiency analyses show Medicaid managed care had the highest efficiency from both the consumer and societal perspectives, which displayed an increasing trend for the insurer as a whole post-ACA. Additionally, some ACA modifications by the Trump administration seemed to have helped with efficiency improvement. During the COVID-19 pandemic, societal efficiency changes suggested selection bias in delayed care and the following pick-up regarding the cost of medical services.

Keywords: Premiums; Medical expenses; Medical service utilization; Consumer efficiency; Societal efficiency; G22; I11; I13; I18 (search for similar items in EconPapers)
Date: 2025
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Persistent link: https://EconPapers.repec.org/RePEc:spr:sprchp:978-3-031-69674-9_19

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DOI: 10.1007/978-3-031-69674-9_19

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