nep-ias New Economics Papers
on Insurance Economics
Issue of 2018‒01‒08
seventeen papers chosen by
Soumitra K. Mallick
Indian Institute of Social Welfare and Business Management

  1. Social Protection and Access to Health Care among Children in the Philippines By Abrigo, Michael R.M.; Paqueo, Vicente B.
  2. Crop Insurance Program of the Philippine Crop Insurance Corporation: Integrative Report from the Five Case Regions in the Philippines By Reyes, Celia M.; Mina, Christian D.; Agbon, Adrian D.; Arboneda, Arkin
  3. Insurance-Growth Nexus in Africa By Mehmet Balcilar; Rangan Gupta; Chien-Chiang Lee; Godwin Olasehinde-Williams
  4. BOND Implementation and Evaluation: 2015 Stage 2 Interim Process, Participation, and Impact Report By Daniel Gubits; Judy Geyer; Denise Hoffman; Sarah Croake; Utsav Kattel; David Judkins; Stephen Bell; David Stapleton
  5. France: improving the efficiency of the health-care system By Antoine Goujard
  6. Surprise! Out-of-Network Billing for Emergency Care in the United States By Zack Cooper; Fiona Scott Morton; Nathan Shekita
  7. Shortening the potential duration of unemployment benefits and labor market outcomes: Evidence from a natural experiment in Germany By Inna Petrunyk; Christian Pfeifer
  8. Patients motivation and health plan choice By DongWoo Ko
  9. Games for cautious players: the equilibrium in secure strategies By ISKAKOV, Mikhail; ISKAKOV, Alexey; d'ASPREMONT, Claude
  10. The Macroeconomic Effects of Longevity Risk under Private and Public Insurance and Asymmetric Information By Ben J. Heijdra; Yang Jiang; Jochen O. Mierau
  11. Can Regional Decentralisation Shift Health Care Preferences? By Joan Costa-i-Font; Ada Ferrer-i-Carbonell
  12. Evaluation of Medicare Disease Management Programs: LifeMasters Final Report of Findings By Dominick Esposito; Kate A. Stewart; Randall Brown
  13. Repealing or Replacing the ACA’s Provisions: How Would Adults with Disabilities Fare? By Purvi Sevak; Jody Schimmel Hyde; Matthew Kehn
  14. The parental home as labor market insurance for young Greeks during the crisis By Christopoulou, Rebekka; Pantalidou, Maria
  15. Population Segmentation and Targeting of Health Care Resources: Findings from a Literature Review By Dana Jean-Baptiste; Ann O'Malley; Tanya Shah
  16. Cost-Sharing Design Matters : A Comparison of the Rebate and Deductible in Healthcare By Remmerswaal, Minke; Boone, Jan; Bijlsma, Michiel; Douven, R.C.M.H.
  17. France: Améliorer l’efficience du système de santé By Antoine Goujard

  1. By: Abrigo, Michael R.M.; Paqueo, Vicente B.
    Abstract: The Philippines recently introduced two distinct but related large-scale social protection programs that, first, provides conditional cash transfers (CCT) to poor households, and, second, automatically enrolls them into the government's social health insurance program. This has resulted to dramatic increase in health insurance coverage, especially among the poor. In this paper, we empirically assess the joint impact of the two programs on the health-care demand for children. Overall, we find encouraging impacts of social protection on the demand for health-care services. While we find no direct impact on morbidity, our results suggest that the social health insurance and the CCT program jointly were able to induce greater hospital visits for both preventive and curative care, and lower out-of-pocket expenditures. However, we also document possible leakages in the government's programs, as well as potential indication of health-care service differentiation based on quality. Both these concerns may undermine the expected outcomes of the country's social protection programs.
    Keywords: Philippines, social health insurance, CCT, social protection, conditional cash transfer
    Date: 2017
  2. By: Reyes, Celia M.; Mina, Christian D.; Agbon, Adrian D.; Arboneda, Arkin
    Abstract: Risk is a daily reality especially among agricultural producers in developing countries, thus agricultural insurance is of interest to farmers, policymakers, insurance companies, and development finance institutions. From a survey data of 2,512 farmers, this paper sheds light on the possible factors affecting insurance availment among the farmers in five selected regions in the Philippines. The farmers' reasons for availing of crop include: encouraged by neighbors, friends, relatives and because of the agricultural technicians in the local government unit. Farmers also shared that insurance is a requirement for getting a loan. Among the possible factors for insurance uptake, level of education, farming experience, and membership in farmer organization are significant factors in the availment of crop insurance from the Philippine Crop Insurance Corporation. Increasing coverage rate of crop insurance among farmers remains to be a challenge in a highly subsidized crop insurance program of the Philippines.
    Keywords: Philippines, poverty, crop insurance, PCIC, risks and shocks in agriculture, Philippine Crop Insurance Corporation
    Date: 2017
  3. By: Mehmet Balcilar (Department of Economics, Eastern Mediterranean University, Famagusta, Northern Cyprus, Turkey; Department of Economics, University of Pretoria, South Africa and Montpellier Business School, Montpellier, France.); Rangan Gupta (Department of Economics, University of Pretoria, Pretoria, South Africa); Chien-Chiang Lee (Department of Finance, National Sun Yat-sen University, Kaohsiung, Taiwan); Godwin Olasehinde-Williams (Department of Economics, Eastern Mediterranean University, Famagusta, Northern Cyprus, Turkey)
    Abstract: Economic growth may be influenced by insurance-market activity through risk pooling, financial intermediations, indemnification against losses, mobilization of savings and provision of investment opportunities. Over the past few decades, there has been increasing interest in the role of the insurance sector in the economic growth of Africa. This study examines whether there is a causal relationship between the continent’s economic growth and insurance-market activity (life, non-life, and total). Applying panel-estimation techniques that are robust to heterogeneity and cross-sectional dependence to a model of panel data for 11 African countries between 1995 and 2016, we find significant evidence in support of such a relationship. Total-insurance penetration has a long-term impact on economic growth, and when disaggregated into its components (life- and non-life-insurance penetration), we find evidence in support of short-term and long-term impacts on economic growth in both cases. Our study also confirms the feedback hypothesis, as we find a positive, bi-directional causality between insurance-market activity and economic growth. We also find that the contribution from non-life-insurance market activity toward economic growth far outweighs that of life-insurance market activity.
    Keywords: Insurance penetration, growth, Africa
    JEL: C33 G22
    Date: 2018–01
  4. By: Daniel Gubits; Judy Geyer; Denise Hoffman; Sarah Croake; Utsav Kattel; David Judkins; Stephen Bell; David Stapleton
    Abstract: The Benefit Offset National Demonstration (BOND) tests variants of Social Security Disability Insurance program rules governing work and other supports. The BOND project includes two stages. Stage 2 provides estimates of how a $1 for $2 benefit offset would affect earnings and program outcomes for beneficiaries most likely to use the offset: recruited and informed volunteers. This report documents results of BOND Stage 2 impacts on earnings and benefit outcomes during the third calendar year of implementation (2013) and process and participation analyses through 2014.
    Keywords: Disability, Social Security, Employment, Benefit Offset, Counseling
    JEL: I J
  5. By: Antoine Goujard
    Abstract: France’s health-care system offers high-quality care. Average health outcomes are good, public satisfaction with the health-care system is high, and average household out-of-pocket expenditures are low. As in other OECD countries, technology is expanding possibilities for life extension and quality, and spending is rising steadily, while an ageing population requires substantially more and different services. The main challenges are to promote prevention and cost-efficient behaviour by care providers, tackle the high spending on pharmaceuticals, strengthen the role of health insurers as purchasing agents and secure cost containment. Good-quality information and appropriate financing schemes would ensure stronger efficiency incentives. Disparities of coverage across social groups and health services suggest paying greater attention to co-ordination between statutory and complementary insurance provision. Ongoing reforms to improve prevention and co-ordination among care providers are steps in the right direction. However, progress in the development of capitation-based payment schemes, which can reduce the incentives to increase the number of medical acts and encourage health professionals to spend more time with their patients, and performance-based payment schemes in primary care need to be stepped up to respond to the increasing prevalence of chronic diseases and curb supplier-induced demand and social disparities in access to care.
    Keywords: ageing, fee-for-services, France, generics, health care system, health disparities, health insurance, health policy, health practitioners, healthcare coordination, hospital, medical demography, pharmaceutical expenditures, prevention, primary healthcare
    JEL: I11 I12 I13 I15 I18
    Date: 2018–01–10
  6. By: Zack Cooper; Fiona Scott Morton; Nathan Shekita
    Abstract: Using insurance claims data capturing 8.9 million emergency episodes, we show that in 22% of cases, patients attended in-network hospitals, but were treated by out-of-network physicians. We find that out-of-network billing is concentrated in a small group of primarily for-profit hospitals. Within 50% of hospitals in our sample, fewer than 5% of patients saw out-of-network physicians. In contrast, at 15% of hospitals, more than 80% of patients saw out-of-network physicians. Out-of-network billing allows physicians to substantially increase their payment rates relative to what they would be paid for treating in-network patients and significantly improve their outside option when bargaining over in-network payments. Because patients cannot avoid out-of-network physicians during an emergency, physicians have an incentive to remain out-of-network and receive higher payment rates. Hospitals incur costs when out-of-network billing occurs within their facilities. We illustrate in a model and confirm empirically via analysis of two leading physician-outsourcing firms that physicians offer transfers to hospitals to offset the hospitals' costs of allowing out-of-network billing to occur within their facilities. We find that a New York State law that introduced binding arbitration between physicians and insurers to settle surprise bills reduced out-of-network billing rates.
    Keywords: health care, emergency care, US, hospital, politics
    JEL: I11 I13 I18 L14
    Date: 2017–12
  7. By: Inna Petrunyk (Leuphana University Lueneburg, Germany); Christian Pfeifer (Leuphana University Lueneburg, Germany)
    Abstract: This paper explores the effects of a major reform of unemployment benefits in Germany on the labor market outcomes of individuals with some health impairment. The reform induced a substantial reduction in the potential duration of regular unemployment benefits for older workers. This work analyzes the reform in a wider framework of institutional interactions, which allows us to distinguish between its intended and unintended effects. Our results provide causal evidence for a significant decrease in the number of days in unemployment benefits and increase in the number of days in employment. However, they also suggest a significant increase in the number of days in unemployment assistance, granted upon exhaustion of unemployment benefits. Transitions to unemployment assistance represent an unintended effect, limiting the success of a policy change that aims to increase labor supply via reductions in the generosity of the unemployment insurance system.
    Keywords: policy evaluation, labor market reform, unemployment insurance, difference-in-differences
    JEL: I1 J2 J65
    Date: 2018–01
  8. By: DongWoo Ko (Hankuk University of Foreign Studies, South Korea)
    Abstract: Previous studies have shown that Medicare beneficiaries tend not to switch their prescription drug plans even though they can largely save drug costs by plan switching. To explore why this so called “plan stickiness†happens, the present study focused on the concept of social exclusion, which is one of the most important characteristics of the elderly. This study compared the impact of two types of social exclusion on an association between psychological cost and plan switchingpassive social exclusion and active social exclusion. These two types are known to differently influence consumers’ motivation and decision-making process. The 2007 Prescription Drug Study supplement to the Health and Retirement Study data were used for analysis. We investigated the individual- level willingness to switch across multiple levels using a Hierarchical Linear Model. The findings suggest that passive social exclusion is associated with uncertainty cost. Study findings will help policymakers better understand the elderly’s plan decision- making process and promote their informed plan decisions.
    Keywords: Medicare, Beneficiaries Non-Switching Behavior, Psychological Cost, Hierarchical Linear Model.
    Date: 2017
  9. By: ISKAKOV, Mikhail; ISKAKOV, Alexey; d'ASPREMONT, Claude (Université catholique de Louvain, CORE, Belgium)
    Abstract: A non-cooperative solution, the Equilibrium in Secure Strategies (EinSS), is defined that extends the Nash equilibrium in pure strategies when it does not exist and is meant to solve games where players are "cautious", i.e. looking for secure positions and avoiding threats. This concept abstracts and unifies various ad hoc solutions already formulated in various applied economic games that have been discussed extensively in the literature. It complements usefully mixed strategy Nash equilibria that are usually not explicit and difficult to interpret in these games. Like the Nash equilibrium, the EinSS is a static concept, and the basic requirement of excluding at equilibrium some deviations remains. But it also appeals to dynamic intuitions, tolerating at equilibrium the possibility of some deviations, which would be blocked by counter-deviations punishing the deviator. This is in line with the "objection-counter- objection" rationale first introduced in cooperative games. A general existence theorem is provided and then applied to the price-setting game in Hotelling location model, to Tullock's rent-seeking contests and to Bertrand-Edgeworth duopoly. Finally competition in the insurance market game is re-examined and the Rothchild-Stiglitz- Wilson contract shown to be an EinSS even when the Nash equilibrium breaks down.
    Keywords: Noncooperative games, Equilibrium existence, Discontinuous games, Equilibrium in secure strategies, Hotelling model, Tullock contest, Insurance market, Bertrand-Edgeworth duopoly
    JEL: C72 D03 D43 D72 L12 L13
    Date: 2016–10–21
  10. By: Ben J. Heijdra; Yang Jiang; Jochen O. Mierau
    Abstract: We study the impact of a fully-funded social security system in an economy with heterogeneous consumers. The unobservability of individual health conditions leads to adverse selection in the private annuity market. Introducing social security—which is immune to adverse selection—affects capital accumulation and individual welfare depending on its size and on the pension benefit rule that is adopted. If this rule incorporates some implicit or explicit redistribution from healthy to unhealthy individuals then the latter types are better off as a result of the pension system. In the absence of redistribution the public pension system makes everybody worse off in the long run. Though attractive to distant generations, privatization of social security is not generally Pareto improving to all generations.
    Keywords: social security, annuity market, adverse selection, overlapping generations, redistribution
    JEL: D91 E10 H55 J10
    Date: 2017
  11. By: Joan Costa-i-Font; Ada Ferrer-i-Carbonell
    Abstract: Uniform health care delivered by a mainstream public insurer - such as the National Health Service (NHS), seldom satisfies heterogeneous demands for care, and some unsatisfied share of the population either use private health care, or purchase private insurance (PHI). One potential mechanism to partially satisfy heterogeneous preferences for health care, and discourage the use of private health care, is regional health care decentralisation. We find robust estimates suggesting that the development of regional health services shifted both perceptions of, and preferences for, using the NHS, making it more likely individuals would use public health care and, consequently, reducing the uptake of PHI. These results are heterogeneous by income, education, and age groups; and are robust to placebo and other robustness and falsification checks.
    Keywords: National Health Service (NHS), political decentralization, use of private health care, private health insurance, health system satisfaction, demand for private health care
    JEL: H70 I18
    Date: 2017
  12. By: Dominick Esposito; Kate A. Stewart; Randall Brown
    Abstract: From January 2005 to December 2007, the Centers for Medicare & Medicaid Services (CMS) sponsored a population-based disease management demonstration program implemented by LifeMasters Supported SelfCare (LifeMasters).
    Keywords: Medicare , Disease Management , LifeMasters
    JEL: I
  13. By: Purvi Sevak; Jody Schimmel Hyde; Matthew Kehn
    Abstract: In this brief, we focus on the effects the proposed policy changes could have on individuals with disabilities and individuals with chronic conditions that could become disabling. We begin by discussing the likely effects on coverage and access to care, and review the potential effects the coverage changes would have on employment.
    Keywords: Affordable Care Act, Medicaid expansion, disabilities, employment, health insurance
    JEL: I J
  14. By: Christopoulou, Rebekka; Pantalidou, Maria
    Abstract: Labor market conditions in Greece have severely deteriorated during the crisis, affecting youths the most. Using the Greek crisis as a case-study, this paper examines the role of the family as a social safety net for its young members. Specifically, we test the relationship between youth labor outcomes and parental co-residence, whether this relationship has become stronger during the crisis, and the degree to which the relationship is causal. Our results confirm that the parental home is a refuge both for jobless youth and for those in poorly paid, insecure jobs, and this role has intensified during the crisis. We find no reverse causality between co-residence and employment status for young men, and significant reverse causality for women. This finding implies that all youths live in the parental home when they are in need themselves, but it is young women not men who live with parents when parents are in need or for cultural reasons.
    Keywords: Living arrangements,parental coresidence,youth employment,great recession,Greece
    JEL: J12 J21
    Date: 2017
  15. By: Dana Jean-Baptiste; Ann O'Malley; Tanya Shah
    Abstract: This paper examines published and gray literature describing how health care organizations both segment their HNHC populations into subgroups and target care management and other resources to subgroups.
    Keywords: Population segmentation, high-need, high-cost, super utilizer, high-risk patients, care management program, risk stratification, chronic conditions
    JEL: I
  16. By: Remmerswaal, Minke (Tilburg University, Center For Economic Research); Boone, Jan (Tilburg University, Center For Economic Research); Bijlsma, Michiel (Tilburg University, Center For Economic Research); Douven, R.C.M.H.
    Abstract: Since 2006, the Dutch population has faced two different cost-sharing schemes in health insurance for curative care: a mandatory rebate of 255 euros in 2006 and 2007, and since 2008 a mandatory deductible. Using administrative data for the entire Dutch population, we compare the effect of both cost-sharing schemes on healthcare consumption between 2006 and 2013. We use a regression discontinuity design which exploits the fact that persons younger than eighteen years old neither face a rebate nor a deductible. Our fixed effect estimate shows that for individuals around the age of eighteen, a one euro increase of the deductible reduces healthcare expenditures 18 eurocents more than a euro increase of the rebate. These results demonstrate that differences in the design of a cost-sharing scheme can lead to substantial different effects on total healthcare expenditure.
    Keywords: deductible; rebate; cost-sharing; healthcare consumption; regression discontinuity; panel data
    Date: 2017
  17. By: Antoine Goujard
    Abstract: Le système de santé français offre des soins de haute qualité. Les résultats moyens sur le plan de la santé sont bons, le public est très satisfait du système de santé et les restes à charge sont en moyenne faibles. Comme dans d’autres pays de l’OCDE, le progrès technologique accroît l’espérance et la qualité de vie, alors que la population vieillissante nécessite des services toujours plus nombreux et diversifiés. Les principales difficultés consistent à inciter les professionnels de la santé à adopter un comportement efficient, à enrayer la hausse des dépenses pharmaceutiques, à renforcer le rôle des assureurs en tant qu’agents acheteurs et à assurer la maîtrise des coûts. Une information de bonne qualité et des mécanismes de financement appropriés renforceraient les incitations à l’efficience. Les différences de couverture selon les maladies et les groupes sociaux montrent la nécessité de prêter davantage attention à la coordination entre l’assurance maladie obligatoire et l’assurance complémentaire. Les réformes en cours visant à améliorer la coordination entre les professionnels de santé et à renforcer le rôle de la prévention vont dans le bon sens. Cependant, le développement de mécanismes de rémunération à la capitation qui permettent d’avoir moins d’incitations à multiplier les actes et d’encourager les professionnels de santé à s’occuper plus longtemps des patients, tout comme les paiements en fonction des résultats dans les soins primaires doivent être renforcés afin de faire face à la prévalence croissante des maladies chroniques et de réduire la demande induite par l’offre et les disparités sociales en terme d’accès aux soins.
    Keywords: assurances médicales, coordination du système de santé, disparités de santé, démographie médicale, dépenses pharmaceutiques, France, génériques, hôpital, politique de santé, professions médicales, prévention, soins primaires de santé, système de santé, tarification à l’acte, vieillissement
    JEL: I11 I12 I13 I15 I18
    Date: 2018–01–03

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