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on Insurance Economics |
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Issue of 2015‒11‒01
fourteen papers chosen by Soumitra K. Mallick Indian Institute of Social Welfare and Business Management |
| By: | Cara Orfield; Lauren Hula; Michael Barna |
| Abstract: | Individuals receiving coverage through the Affordable Care Act’s new health insurance Marketplaces, Medicaid, or the Children’s Health Insurance Program (CHIP) can be expected to experience changes in income and/or family size over time that may result in changes to their health insurance program eligibility, necessitating transitions between programs. To ascertain the degree to which continuity of care may be affected by individuals making transitions between Marketplace, Medicaid, and CHIP coverage, we examined the networks of primary care physicians offered through these programs in six diverse market areas. |
| Keywords: | Continuity of care, Affordable Care Act, Medicaid/CHIP coverage, access to care |
| JEL: | I |
| Date: | 2014–11–03 |
| URL: | http://d.repec.org/n?u=RePEc:mpr:mprres:1d91fa47b644434e9e8f9a7557af1338&r=ias |
| By: | Brendan Saloner (Department of Health Policy and Management, Johns Hopkins University); Yaa Akosa Antwi (Department of Economics, Indiana University - Purdue University Indianapolis); Johanna Catherine Maclean (Department of Economics, Temple University); Benjamin Lê Cook (Center for Multicultural Mental Health Research, Harvard Medical School) |
| Abstract: | The relationship between insurance coverage and use of substance use disorders (SUDs) treatment is not well understood. SUD treatment has long been segregated from general medical care, and has had low reliance on private insurance. We examine changes in admissions to publicly-funded, specialty SUD treatment following the implementation of a 2010 Affordable Care Act provision requiring health insurers to offer dependent coverage to young adult children. We compare admissions from the 2007-2012 Treatment Episode Data Set among targeted young adults to older adults. We find that admissions to treatment declined by 11 percent among young adults after the provision. However, the share of young adults covered by private insurance increased by 9.3 percentage points and the share with private insurance as the payment source increased by 6.5 percentage points. This increase was largely offset by decreased self-payment and payment by state and local government sources, followed by decreased Medicaid payment. Public sector providers gained new revenues from private insurers, and the share of patients paying primarily out-of-pocket decreased. Our findings suggest expansions of private insurance may not increase demand for public sector treatment but could provide important revenue for existing patients. |
| Keywords: | Dependent care coverage; Affordable Care Act; health insurance; substance use disorder treatment |
| JEL: | I13 I11 I18 |
| Date: | 2015–09 |
| URL: | http://d.repec.org/n?u=RePEc:tem:wpaper:1509&r=ias |
| By: | Cara Orfield; Lauren Hula; Michael Barna; Sheila Hoag |
| Abstract: | As the Patient Protection and Affordable Care Act ushers in a new era in health care coverage and delivery, significant changes to the health insurance landscape have personal implications for individuals whose insurance options change. |
| Keywords: | Affordable Care Act, Access to care, Coverage Sources |
| JEL: | I |
| Date: | 2015–11–01 |
| URL: | http://d.repec.org/n?u=RePEc:mpr:mprres:8b0525b1033341bf9446fa8750431064&r=ias |
| By: | Andrew Ellul (Indiana University); Marco Pagano (University of Naples Federico II); Fabiano Schivardi (Bocconi University) |
| Abstract: | We investigate the determinants of firms’ implicit employment and wage insurance to employees, using a difference-in-difference approach: we rely on differences between family and non-family firms to identify the supply of insurance, and exploit variation in unemployment insurance programs across and within countries to gauge workers’ demand for insurance. Using a firm-level panel from 41 countries, we find that family firms provide more stable employment than nonfamily ones, and in exchange they obtain both greater wage flexibility and lower labor cost: on average, their real wages are 5 percent lower, controlling for country, industry and time effects. The additional employment security provided by family firms is greater, and the wage discount larger, the less generous is public unemployment insurance: private and public provision of employment insurance appear to be substitutes. |
| Keywords: | risk-sharing, insurance, social security, unemployment, wages, family firms. |
| JEL: | G31 G32 G38 H25 H26 M40 |
| Date: | 2015 |
| URL: | http://d.repec.org/n?u=RePEc:lui:celegw:1506&r=ias |
| By: | Düll, Robert; König, Felix; Ohls, Jana |
| Abstract: | A sovereign debt crisis can have significant knock-on effects in the financial markets and put financial stability at risk. This paper focuses on the transmission of sovereign risk to insurance companies as some of the largest institutional investors in the sovereign bond market. We use a firm level panel dataset that covers large insurance companies, banks and non-financial firms from nine countries in the time period January 1st 2008 to May 1st 2013. We find significant and robust transmission effects from sovereign risk to domestic insurers. The impact on insurers is larger than for non-financial firms and slightly smaller than for banks. We find that systemically important insurers were more closely linked to the domestic sovereign. Based on European data, we show that risks in sovereign bond portfolios are an important driver of insurer risk, which is not reflected in current insurance regulation (incl. upcoming Solvency II in Europe). |
| Keywords: | insurance,sovereign risk,sovereign bond portfolio |
| JEL: | G22 G28 G15 |
| Date: | 2015 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:bubdps:342015&r=ias |
| By: | Zelalem Yilma (Erasmus University Rotterdam); Owen O’Donnell (Erasmus University Rotterdam); Anagaw Mebratie (Erasmus University Rotterdam); Getnet Alemu (Addis Ababa University, Ethiopia); Arjun S. Bedi (Erasmus University Rotterdam, the Netherlands) |
| Abstract: | Little is known about perceptions of medical expenditure risks despite their presumed relevance to health insurance demand. This paper reports on a unique elicitation of subjective probabilities of medical expenditures from rural Ethiopians who are offered the opportunity to purchase health insurance. We find that expectations are positively correlated with past expenses to a degree that exceeds the serial correlation in realized expenditures, suggesting overestimation of persistence and underestimation of the potential gains from insurance. Despite the fact that forecast expenditures do predict realized expenditures to some extent, there is no evidence that expectations influence the decision to take out health insurance, although plans to insure are positively related to the perceived dispersion of medical expenses. |
| Keywords: | Subjective probability; medical expenditure; out-of-pocket payments; adverse selection; health insurance; Ethiopia |
| JEL: | D82 D84 I13 O12 |
| Date: | 2015–10–26 |
| URL: | http://d.repec.org/n?u=RePEc:tin:wpaper:20150120&r=ias |
| By: | Johanna Catherine Maclean (Department of Economics, Temple University); Brendan Saloner (Department of Health Policy and Management, Johns Hopkins University) |
| Abstract: | Major expansions of health insurance coverage provide new revenue opportunities for safety-net providers, but may also create new capacity pressures for these providers. We examine the impact of the 2006 Massachusetts healthcare reform on substance use disorder (SUD) treatment - a type of safety net healthcare – providers' behaviors using a differences-in-differences design. We test whether the reform influenced admissions, daily censuses (the number of clients in treatment on a given day), services offered, and accepted forms of payment. Our findings suggest that Massachusetts providers altered their care practices following the reform. Admissions increased by 17.1% and daily censuses increased by 4.7%. The number of services offered increased by 3.5%, programs for special populations decreased by 24.1%, and use of pharmacotherapies increased by 11.3%. Massachusetts providers increased acceptance of private insurance increased by 2.7%. We find that such providers were less likely to accept self-pay (1.7%) and provide uncompensated care (1.4%). Responsiveness was generally greater for for-profit than nonprofit providers. These findings suggest that, following major healthcare reform, Massachusetts SUD treatment providers absorbed a larger number of individuals seeking treatment, but effects on quality of care were somewhat mixed and individuals without insurance may have experienced difficulty in accessing care. |
| Keywords: | healthcare; safety net; provider behavior; substance use disorders; healthcare reform |
| JEL: | I1 I11 I18 |
| Date: | 2015–09 |
| URL: | http://d.repec.org/n?u=RePEc:tem:wpaper:1511&r=ias |
| By: | James D. Reschovsky; Eugene Rich |
| Abstract: | An important goal of the Affordable Care Act is to transform the US health care system from one characterized by high costs, poor quality, and fragmented care to one focused on comprehensive, coordinated, and efficient care. |
| Keywords: | Hospital acquisition, physician groups, health care costs |
| JEL: | I |
| Date: | 2015–10–19 |
| URL: | http://d.repec.org/n?u=RePEc:mpr:mprres:09e32d7a2bdf4ab38fcf909a634e16f3&r=ias |
| By: | Sebastian Dyrda; Marcelo Pedroni |
| Abstract: | This paper studies optimal taxation in an environment where heterogeneous households face uninsurable idiosyncratic risk. To do this, we formulate a Ramsey problem in a standard infinite horizon incomplete markets model. We solve numerically for the optimal path of proportional capital and labor income taxes, (possibly negative) lump-sum transfers, and government debt. The solution maximizes welfare along the transition between an initial steady state, calibrated to replicate key features of the US economy, and an endogenously determined final steady state. We find that in the optimal (utilitarian) policy: (i) capital income taxes are front-loaded hitting the imposed upper bound of 100 percent for 33 years before decreasing to 45 percent in the long-run; (ii) labor income taxes are reduced to less than half of their initial level, from 28 percent to about 13 percent in the long-run; and (iii) the government accumulates assets over time reducing the debt-to-output ratio from 63 percent to -17 percent in the long-run. Relative to keeping fiscal instruments at their initial levels, this leads to an average welfare gain equivalent to a permanent 4.9 percent increase in consumption. Even though non-distortive lump-sum taxes are available, the optimal plan has positive capital and labor taxes. Such taxes reduce the proportions of uncertain and unequal labor and capital incomes in total income, increasing welfare by providing insurance and redistribution. We quantify these welfare effects. We also show that calculating the entire transition path (as opposed to considering steady states only) is quantitatively important. Implementing the policy that maximizes welfare in steady state leads to a welfare loss of 6.4 percent once transitory effects are accounted for. |
| Keywords: | Optimal Taxation; Heterogenous Agents; Incomplete markets |
| JEL: | E2 E6 H2 H3 D52 |
| Date: | 2015–10–27 |
| URL: | http://d.repec.org/n?u=RePEc:tor:tecipa:tecipa-549&r=ias |
| By: | Sebastian Dyrda; Marcelo Pedroni |
| Abstract: | This paper studies optimal taxation in an environment where heterogeneous households face uninsurable idiosyncratic risk. To do this, we formulate a Ramsey problem in a standard infinite horizon incomplete markets model. We solve numerically for the optimal path of proportional capital and labor income taxes, (possibly negative) lump-sum transfers, and government debt. The solution maximizes welfare along the transition between an initial steady state, calibrated to replicate key features of the US economy, and an endogenously determined final steady state. We find that in the optimal (utilitarian) policy: (i) capital income taxes are front-loaded hitting the imposed upper bound of 100 percent for 33 years before decreasing to 45 percent in the long-run; (ii) labor income taxes are reduced to less than half of their initial level, from 28 percent to about 13 percent in the long-run; and (iii) the government accumulates assets over time reducing the debt-to-output ratio from 63 percent to -17 percent in the long-run. Relative to keeping fiscal instruments at their initial levels, this leads to an average welfare gain equivalent to a permanent 4.9 percent increase in consumption. Even though non-distortive lump-sum taxes are available, the optimal plan has positive capital and labor taxes. Such taxes reduce the proportions of uncertain and unequal labor and capital incomes in total income, increasing welfare by providing insurance and redistribution. We quantify these welfare effects. We also show that calculating the entire transition path (as opposed to considering steady states only) is quantitatively important. Implementing the policy that maximizes welfare in steady state leads to a welfare loss of 6.4 percent once transitory effects are accounted for. |
| Keywords: | Optimal Taxation; Heterogenous Agents; Incomplete markets |
| JEL: | E2 E6 H2 H3 D52 |
| Date: | 2015–10–27 |
| URL: | http://d.repec.org/n?u=RePEc:tor:tecipa:tecipa-550&r=ias |
| By: | Marios Michaelides; Peter Mueser |
| Abstract: | This paper examines four experimental design U.S. reemployment programs targeting Unemployment Insurance (UI) recipients during the Great Recession. Results show that, regardless of their specific requirements, reemployment programs led to shorter UI spells, UI savings that exceeded program costs, and improved employment rates and earnings. Program success was partly attributable to threat effects, occurring because some participants exited UI early in their claims to avoid program participation. Also, programs that conducted eligibility reviews were effective in reducing UI fraud, pushing job-ready or ineligible participants to exit UI and return to employment sooner. In addition to these initial effects, our results suggest that program services may have substantial direct value. The program that combined the eligibility review with mandatory job-counselling services produced greater effects than the other programs, and our analyses suggest that this is because services helped participants improve their job search. These findings provide important policy guidance on the kinds of programs that are effective and evidence that program benefits occur even during an economic downturn. |
| Keywords: | Great Recession, job search services, eligibility review, unemployment, Unemployment Insurance, program evaluation. |
| Date: | 2015–10 |
| URL: | http://d.repec.org/n?u=RePEc:ucy:cypeua:08-2015&r=ias |
| By: | Emla Fitzsimons (Institute for Fiscal Studies and Institute of Education, University of London); Bansi Malde (Institute for Fiscal Studies and Institute for Fiscal Studies); Marcos Vera-Hernandez (Institute for Fiscal Studies and University College London) |
| Abstract: | The objective of this paper is to understand and test empirically the relationship between group size and informal risk sharing. Models of informal risk sharing with limited commitment and grim-trigger punishments upon deviation imply that larger groups provide better informal insurance. However, when subgroups of households can credibly deviate, so that sustainable informal arrangements ought to be coalition-proof, the relationship between group size and the amount of insurance is unclear. Building on the framework of Genicot and Ray (2003), we show that this relationship is theoretically ambiguous. We then investigate it empirically using data on the size of the sibships of the household head and spouse in rural Malawi. To identify the relevant potential group within which risk is shared, we exploit a social norm among the main ethnic group in our sample which is such that the brothers of the wife should play a key role in ensuring her household’s wellbeing. We ?nd that households in which the wife has many brothers are not well-insured against crop loss events. Importantly, we fail to uncover a similar relationship for the sisters of the wife, ruling out that our ?ndings are driven by wives with many siblings (e.g. brothers) having poorer extended family networks. Calibrating our theoretical framework using values similar to those in our sample produces a relationship between household risk sharing and group size that is similar to that uncovered in the data, indicating that the threat of coalitional deviations can explain our empirical ?ndings. |
| Date: | 2015–10 |
| URL: | http://d.repec.org/n?u=RePEc:ifs:ifsewp:15/31&r=ias |
| By: | Johanna Catherine Maclean (Department of Economics, Temple University); Ioana Popovici (Department of Sociobehavioral and Administrative Pharmacy, Nova Southeastern University); Elisheva Stern (Department of Economics, Temple University) |
| Abstract: | We examine how substance use disorder (SUD) treatment providers respond to private health insurance expansions induced by state parity laws for SUD treatment. We use data on the near universe of specialty SUD treatment providers in the United States 1997-2009. During this period, 16 states implemented SUD parity laws. Our findings suggest that admissions and client volumes increase following parity law passage, treatment shifts to less intensive settings, and quality is unchanged. Providers alter the type of payment they accept and patients they admit. We find no evidence that SUD parity laws improve public health, proxied by overdose deaths. |
| Keywords: | healthcare; provider behavior; substance use disorders; health insurance mandates |
| JEL: | I1 I11 I18 |
| Date: | 2015–09 |
| URL: | http://d.repec.org/n?u=RePEc:tem:wpaper:1510&r=ias |
| By: | Cara Orfield; Michael Barna; Lauren Hula |
| Abstract: | This report is the second in a two-part study aimed at learning more about how easily individuals can maintain their primary care physicians as they transition across programs. In this report, we explore in more depth the reasons behind issuer decisions on program participation and provider network design, how they respond to and perceive the federal and state regulatory framework in which they operate, and major lessons learned during the first open enrollment period. |
| Keywords: | Continuity of care, Affordable Care Act, Medicaid/CHIP coverage, access to care |
| JEL: | I |
| Date: | 2014–11–03 |
| URL: | http://d.repec.org/n?u=RePEc:mpr:mprres:cffa906ec67c42de92e156ba87d41f00&r=ias |