EconPapers    
Economics at your fingertips  
 

Can Health Insurance Competition Work? Evidence from Medicare Advantage

Vilsa Curto, Liran Einav, Jonathan Levin and Jay Bhattacharya

No 20818, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: We estimate the economic surplus created by Medicare Advantage under its reformed competitive bidding rules. We use data on the universe of Medicare beneficiaries, and develop a model of plan bidding that accounts for both market power and risk selection. We find that private plans have costs around 12% below fee-for-service costs, and generate around $50 dollars in surplus on average per enrollee-month, after accounting for the disutility due to enrollees having more limited choice of providers. Taxpayers provide a large additional subsidy, and insurers capture most of the private gains. We use the model to evaluate possible program changes.

JEL-codes: D43 I11 I13 L13 L33 L51 (search for similar items in EconPapers)
Date: 2014-12
New Economics Papers: this item is included in nep-com, nep-hea and nep-ias
Note: HC IO PE
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (9) Track citations by RSS feed

Published as Vilsa Curto & Liran Einav & Jonathan Levin & Jay Bhattacharya, 2021. "Can Health Insurance Competition Work? Evidence from Medicare Advantage," Journal of Political Economy, vol 129(2), pages 570-606.

Downloads: (external link)
http://www.nber.org/papers/w20818.pdf (application/pdf)

Related works:
Working Paper: Can Health Insurance Competition Work? Evidence from Medicare Advantage (2014) Downloads
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:nbr:nberwo:20818

Ordering information: This working paper can be ordered from
http://www.nber.org/papers/w20818

Access Statistics for this paper

More papers in NBER Working Papers from National Bureau of Economic Research, Inc National Bureau of Economic Research, 1050 Massachusetts Avenue Cambridge, MA 02138, U.S.A.. Contact information at EDIRC.
Bibliographic data for series maintained by ().

 
Page updated 2021-11-05
Handle: RePEc:nbr:nberwo:20818