@techreport{NBERw15392,
 title = "Regulation of private health insurance markets: Lessons from enrollment, plan type choice, and adverse selection in Medicare Part D",
 author = "Florian Heiss and Daniel McFadden and Joachim Winter",
 institution = "National Bureau of Economic Research",
 type = "Working Paper",
 series = "Working Paper Series",
 number = "15392",
 year = "2009",
 month = "October",
 URL = "http://www.nber.org/papers/w15392",
 abstract = {We study the Medicare Part D prescription drug insurance program as a bellwether for designs of private, non-mandatory health insurance markets that control adverse selection and assure adequate access and coverage.  We model Part D enrollment and plan choice assuming a discrete dynamic decision process that maximizes life-cycle expected utility, and perform counterfactual policy simulations of the effect of market design on participation and plan viability.  Our model correctly predicts high Part D enrollment rates among the currently healthy, but also strong adverse selection in choice of level of coverage.  We analyze alternative designs that preserve plan variety.},
}