NATIONAL BUREAU OF ECONOMIC RESEARCH
NATIONAL BUREAU OF ECONOMIC RESEARCH

Remedies for Sick Insurance

Daniel L. McFadden, Carlos E. Noton, Pau Olivella

NBER Working Paper No. 17938
Issued in March 2012
NBER Program(s):   AG

This expository paper describes the factors that contribute to failure of health insurance markets, and the regulatory mechanisms that have been and can be used to combat these failures. Standardized contracts and creditable coverage mandates are discussed, along with premium support, enrollment mandates, guaranteed issue, and risk adjustment, as remedies for selection-related market damage. An overall conclusion of the paper is that the design and management of creditable coverage mandates are likely to be key determinants of the performance of the health insurance exchanges that are a core provision of the PPACA of 2010. Enrollment mandates, premium subsidies, and risk adjustment can improve the stability and relative efficiency of the exchanges, but with carefully designed creditable coverage mandates are not necessarily critical for their operation.

download in pdf format
   (261 K)

email paper

The NBER Bulletin on Aging and Health provides summaries of publications like this.  You can sign up to receive the NBER Bulletin on Aging and Health by email.

This paper is available as PDF (261 K) or via email.

Machine-readable bibliographic record - MARC, RIS, BibTeX

Document Object Identifier (DOI): 10.3386/w17938

Users who downloaded this paper also downloaded these:
Shapiro Navigating the Patent Thicket: Cross Licenses, Patent Pools, and Standard Setting
Heiss, Leive, McFadden, and Winter w18166 Plan Selection in Medicare Part D: Evidence from Administrative Data
Lockwood and Weinzierl w17784 De Gustibus non est Taxandum: Heterogeneity in Preferences and Optimal Redistribution
Dyrda, Kaplan, and RĂ­os-Rull w17880 Business Cycles and Household Formation: The Micro vs the Macro Labor Elasticity
Attanasio, Hurst, and Pistaferri w17982 The Evolution of Income, Consumption, and Leisure Inequality in The US, 1980-2010
 
Publications
Activities
Meetings
NBER Videos
Data
People
About

Support
National Bureau of Economic Research, 1050 Massachusetts Ave., Cambridge, MA 02138; 617-868-3900; email: info@nber.org

Contact Us