Exit, Voice or Loyalty? An Investigation into Mandated Portability of Front-Loaded Private Health Plans

Juan Pablo Atal, Hanming Fang, Martin Karlsson, Nicolas R. Ziebarth

NBER Working Paper No. 23468
Issued in June 2017
NBER Program(s):Health Care, Health Economics, Industrial Organization, Public Economics

We study theoretically and empirically how consumers in an individual private long-term health insurance market with front-loaded contracts respond to newly mandated portability requirements of their old-age provisions. To foster competition, effective 2009, German legislature made the portability of standardized old-age provisions mandatory. Our theoretical model predicts that the portability reform will increase internal plan switching. However, under plausible assumptions, it will not increase external insurer switching. Moreover, the portability reform will enable unhealthier enrollees to reoptimize their plans. We find confirmatory evidence for the theoretical predictions using claims panel data from a big private insurer.

You may purchase this paper on-line in .pdf format from ($5) for electronic delivery.

Access to NBER Papers

You are eligible for a free download if you are a subscriber, a corporate associate of the NBER, a journalist, an employee of the U.S. federal government with a ".GOV" domain name, or a resident of nearly any developing country or transition economy.

If you usually get free papers at work/university but do not at home, you can either connect to your work VPN or proxy (if any) or elect to have a link to the paper emailed to your work email address below. The email address must be connected to a subscribing college, university, or other subscribing institution. Gmail and other free email addresses will not have access.


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.

Machine-readable bibliographic record - MARC, RIS, BibTeX

Document Object Identifier (DOI): 10.3386/w23468

Users who downloaded this paper also downloaded* these:
Autor, Kostol, Mogstad, and Setzler w23466 Disability Benefits, Consumption Insurance, and Household Labor Supply
Obstfeld and Taylor w23440 International Monetary Relations: Taking Finance Seriously
Levine, Lin, and Wang w23469 Acquiring Banking Networks
Heim, Lurie, and Simon w23471 Did the Affordable Care Act Young Adult Provision Affect Labor Market Outcomes? Analysis Using Tax Data
Deshpande and Li w23472 Who Is Screened Out? Application Costs and the Targeting of Disability Programs
NBER Videos

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

Contact Us