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on Insurance Economics |
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Issue of 2020‒11‒30
fifteen papers chosen by Soumitra K. Mallick Indian Institute of Social Welfare and Business Management |
| By: | James Bailey; Nathan Blascak; Vyacheslav Mikhed |
| Abstract: | In July 2005, a set of cuts to Medicaid eligibility and coverage went into effect in the state of Missouri. These cuts resulted in the elimination of the Medical Assistance for Workers with Disabilities program, more stringent eligibility requirements, and less generous Medicaid coverage for those who retained their eligibility. Overall, these cuts removed about 100,000 Missourians from the program and reduced the value of the insurance for the remaining enrollees. Using data from the Medical Expenditure Panel Survey, we show how these cuts increased out-of-pocket medical spending for individuals living in Missouri. Using data from the Federal Reserve Bank of New York/Equifax Consumer Credit Panel (CCP) and employing a border discontinuity differences-in-differences empirical strategy, we show that the Medicaid reform led to increases in both credit card borrowing and debt in third-party collections. When comparing our results with the broader literature on Medicaid and consumer finance, which has generally measured the effects of Medicaid expansions rather than cuts, our results suggest there are important asymmetries in the financial effects of shrinking a public health insurance program when compared with a public health insurance expansion. |
| Keywords: | Medicaid; health insurance; consumer credit |
| JEL: | I13 I18 G51 G52 |
| Date: | 2020–11–02 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fedpwp:88998&r=all |
| By: | Susan M. Foley; Gina Livermore |
| Abstract: | The Kentucky and Minnesota state vocational rehabilitation agencies participated in a randomized control trial of an intervention designed to increase the earnings of Social Security Disability Insurance beneficiaries. This article introduces a special journal issue that tells the story of the SGA Model Demonstration. |
| Keywords: | Social Security Disability Insurance, Vocational Rehabilitation, Substantial Gainful Activity, employment, disability |
| URL: | http://d.repec.org/n?u=RePEc:mpr:mprres:0a418e1d3ff5463a9ab02006d4aae39d&r=all |
| By: | Stéphane Auray (Observatoire français des conjonctures économiques); David Fuller |
| Abstract: | In this paper, we investigate the causes and consequences of “unclaimed” unemployment insurance (UI) benefits. A search model is developed where the costs to collecting UI benefits include both a traditional “fixed” administrative cost and an endogenous cost arising from worker and firm interactions. Experience rated taxes give firms an incentive to challenge a worker’s UI claim, and these challenges are costly for the worker. Exploiting data on improper denials of UI benefits across states in the U.S. system, a two-way fixed effects analysis shows a statistically significant negative relationship between the improper denials and the UI take-up rate, providing empirical support for our model. We calibrate the model to elasticities implied by the two-way fixed effects regression to quantify the relative size of these UI collection costs. The results imply that on average the costs associated with firm challenges of UI claims account for 41% of the total costs of collecting, with improper denials accounting for 8% of the total cost. The endogenous collection costs imply the unemployment rate responds much slower to changes in UI benefits relative to a model with fixed collection costs. Finally, removing all eligibility requirements and allowing workers to collect UI benefits without cost shows these costs to be 4,5% of expected output net of vacancy costs. Moreover, this change has minimal impact on the unemployment rate. |
| Keywords: | Unemployment insurance; Take-up rate; Experience rating; Matching frictions; Search |
| JEL: | E61 J32 J64 J65 |
| Date: | 2020–07 |
| URL: | http://d.repec.org/n?u=RePEc:spo:wpmain:info:hdl:2441/5f63rk8j8i8vlpr3b1ernvsg0u&r=all |
| By: | Stéphane Auray (Observatoire français des conjonctures économiques); Aurélien Eyquem |
| Abstract: | A tractable incomplete-market model with unemployment, sticky prices, and a fiscal side is used to quantify the macroeconomic effects of lockdown policies and the miti-gating effects of raising government spending and implementing UI benefit extensions. We find that the effects of lockdown policies, although we are relatively conservative about the size of the lockdown, are huge: unemployment doubles on impact and al-most triples even for relatively short lockdown durations. Output falls dramatically and debt-output ratios increase by several tens of percentage points. In addition, the surge in unemployment risk triggers a rise in precautionary savings that make such shocks Keynesian supply shocks: aggregate demand falls by more than aggregate supply, and lockdown policies are deflationary. Unfortunately, we find that raising public spending and extending UI benefits stimulate aggregate demand or improve risk-sharing but has little effects on output and unemployment, although they do alleviate the welfare losses of lockdown policies for the households. |
| Keywords: | Lockdown; Unemployment; Borrowing constraints; Incomplete markets; Government spending; Unemployment insurance |
| JEL: | D52 E21 E62 J64 J65 |
| Date: | 2020–04–16 |
| URL: | http://d.repec.org/n?u=RePEc:spo:wpmain:info:hdl:2441/32r3ebde539odb82dkmep529vf&r=all |
| By: | Samuel Ampaw; Simon Appleton; Xuyan Lou |
| Abstract: | This paper evaluates the heterogeneous effect of health insurance on out-of-pocket healthcare expenditure (OOPHE), using merged data from the Ghana Living Standards Survey and Ghana Health Service reports. It applies conditional-mixed process and censored quantile instrumental variable estimators to tackle censoring and endogeneity. We instrument household insurance rate with community insurance rate (exclusive of the observed household) and control for community unobservables. The quantile regression allows the insurance effect to differ across the distribution of OOPHE. We further perform separate analyses by the types of OOPHE and selected covariates. The results show that insurance reduced OOPHE and the incidence of catastrophic OOPHE in 2013, but not in 2017. Besides, households in the higher expenditure quantiles benefitted more from coverage than those in the median and lower quantiles did in 2013. Also, the insurance benefits accrued exclusively to the wealthiest households, households with older heads, and users of outpatient services in 2013. Lastly, the 2013 survey reveals that families with female heads and those whose heads had primary education benefitted more from health insurance than their counterparts in the other subgroups did. The paper concludes that same health insurance can have varied financial risk implications at different periods, across the distribution of OOPHE, and among various household categories. |
| Keywords: | health insurance, financial risk protection, out-of-pocket healthcare expenditure, catastrophic healthcare expenditure, quantile regression, Ghana |
| Date: | 2020 |
| URL: | http://d.repec.org/n?u=RePEc:not:notcre:20/04&r=all |
| By: | Joan Costa-i-Font; Anna Nicińska |
| Abstract: | We study the effect of exposure to communism (EC), a political-economic regime based on collectivist planning, on preferences for family supports, which we refer to as ‘informal family insurance’. We exploit both cross-country and cohort variation in EC in a large sample of Central and Eastern European countries (CEEC). Against the backdrop that ‘communism gives rise to the abolition of the family’, we find robust evidence that EC strengthens the preference for family insurance which coexists with a stronger preference for social insurance. We find a six per cent increase in preferences for care to older parents and a four per cent increase in preferences for support to pre-school children and financial support to adult children. These effects are explained by the erosion of both generalized trust and the lower confidence in public institutions, suggesting that (raising uncertainty and adversity during) communism increased the demand for all types of available insurance. |
| Keywords: | informal family insurance, family networks, social insurance, interpersonal trust, confidence in institutions, Soviet communism, Eastern Europe |
| JEL: | Z10 P30 |
| Date: | 2020 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ceswps:_8685&r=all |
| By: | Andreeva, Andriyana; Yolova, Galina; Vladova-Ivanova, Violeta |
| Abstract: | The collection of tests, tasks and case studies is intended for students in the bachelor's degree of the University of Economics - Varna. It is consistent with the curriculum in the discipline "Labor and Social Security Law", studied in the specialties "Judicial Administration", "Accounting and Auditing" and "Accounting and Finance". The content complies with the regulations of the Labor Code, the Social Security Code and other laws and regulations in the relevant legal branches. The authors have set themselves the task with the materials included in the collection to help students in the process of mastering the basic principles, concepts and institutes of labor and social security law. |
| Keywords: | labor law, social security law. |
| JEL: | K31 |
| Date: | 2020 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:104029&r=all |
| By: | Stéphane Auray (Observatoire français des conjonctures économiques); Aurélien Eyquem (Groupe d'analyse et de théorie économique) |
| Abstract: | A tractable incomplete-marketmodel with endogenous unemployment risk, sticky prices, real wage rigidity and a fiscal side is calibrated to Euro Area countries and used to analyze the macroeconomic effects of lockdown policies. Modeling them as a shock to the extensive margin of labor adjustment – a rise in separations – produces large and persistent negative effects on output, unemployment and welfare, raises precautionary savings and lowers inflation, in line with early evidence about inflation dynamics. Modeling lockdowns as a shock to the intensive margin – a fall in labor utilization – produces small and short-lived macroeconomic and welfare effects, and implies a counterfactual rise in inflation. Conditional on a lockdown(separation) shock, raising public spending or extending UI benefits by large amounts is much more effective in stimulating the economy than during normal times. Quantitatively however, the ability of such policies to flatten the output and unemployment curves remains limited, even though these policies can alleviate a reasonable share of the aggregate welfare losses from the lockdown. |
| Keywords: | Lockdown; Unemployment; Borrowing constraints; Incomplete markets; Government spending; Unemployment insurance |
| JEL: | D52 E21 E62 J64 J65 |
| Date: | 2020–10 |
| URL: | http://d.repec.org/n?u=RePEc:spo:wpmain:info:hdl:2441/5e33qpbdeh9pgbbfkkp2ddbtam&r=all |
| By: | Loukas Balafoutas; Helena Fornwagner; Rudolf Kerschbamer; Matthias Sutter; Maryna Tverdostup |
| Abstract: | Credence goods markets – like for health care or repair services – with their informational asymmetries between sellers and customers are prone to fraudulent behavior of sellers and resulting market inefficiencies. We present the first model that considers both diagnostic uncertainty of sellers and the effects of insurance coverage of consumers in a unified framework. We test the model’s predictions in a laboratory experiment. Both in theory and in the experiment diagnostic uncertainty decreases the rate of efficient service provision and leads to less trade. In theory, insurance also decreases the rate of efficient service provision, but at the same time it also increases the volume of trade, leading to an ambiguous net effect on welfare. In the experiment, the net effect of insurance coverage on efficiency turns out to be positive. We also uncover an important interaction effect: if consumers are insured, experts invest less in diagnostic precision. We discuss policy implications of our results. |
| Keywords: | credence goods, diagnostic uncertainty, insurance coverage, welfare, model, experiment |
| JEL: | C91 C72 D82 G22 |
| Date: | 2020 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ceswps:_8681&r=all |
| By: | Ellen K. Wilson; Noëlle Richa Siegfried; Asta V. Sorensen |
| Abstract: | The patient-centered medical home (PCMH) model aims to improve primary health care using a patient-centered approach. Little qualitative research has investigated how the PCMH model affects patient experience with care. |
| Keywords: | patient-centered medical home , primary health care , patient experience, Medicaid , Medicare |
| URL: | http://d.repec.org/n?u=RePEc:mpr:mprres:56c9d27a2032433ca56eb9e1538b05a7&r=all |
| By: | Marek Ignaszak (Goethe University Frankfurt, Theodor-W.-Adorno-Platz 3, 60323 Frankfurt, Germany,); Philip Jung (TechnicalUniversityofDortmund,FacultyofBusiness,EconomicsandSocialSciences,44221 Dortmund,Germany); Keith Kuester (University of Bonn Adenauerallee 24-42,53113 Bonn, Germany, and CEPR) |
| Abstract: | Consider a union of atomistic member states, each faced with idiosyncratic business-cycle shocks. Private cross-border risk-sharing is limited, giving a role to a federal unemployment-based transfer scheme. Member states control local labor-market policies, giving rise to a trade-off between moral hazard and insurance. Calibrating the economy to a stylized European Monetary Union, we find notable welfare gains if the federal scheme's payouts take the member states' past unemployment level as a reference point. Member states' control over policies other than unemployment benefits can limit generosity during the transition phase. |
| Keywords: | Unemployment reinsurance, labor-market policy, fiscal federalism, search and matching |
| JEL: | E32 E24 E62 |
| Date: | 2020–11 |
| URL: | http://d.repec.org/n?u=RePEc:ajk:ajkdps:040&r=all |
| By: | Stéphane Auray (LIEPP); Samuel Danthine; Markus Poschke |
| Abstract: | Asubstantial share of severance payments derives from private contracts or collective agreements. In this paper, we study the determination of these payments. We analyze joint bargaining over wages and severance payments in a search-and-matching model with risk-averse workers. Individual bargaining results in levels of severance pay that provide full insurance, but also depend on unemployment benefits and job-finding rates. Unions also choose full insurance. Because their higher wage demands reduce job creation, this requires higher severance pay. Severance pay observed in eight European countries, to which we calibrate the model, lies between predictions from the bargaining and union scenarios. |
| Keywords: | Bargaining; Severance pay; Unemployment insurance; Unions |
| JEL: | E24 J32 J33 J64 J65 |
| Date: | 2020 |
| URL: | http://d.repec.org/n?u=RePEc:spo:wpmain:info:hdl:2441/65dh65gjnn96rqgo52mg09a1uu&r=all |
| By: | Dietmar Pfeifer; Olena Ragulina |
| Abstract: | The central idea of the paper is to present a general simple patchwork construction principle for multivariate copulas that create unfavourable VaR (i.e. Value at Risk) scenarios while maintaining given marginal distributions. This is of particular interest for the construction of Internal Models in the insurance industry under Solvency II in the European Union. |
| Date: | 2020–11 |
| URL: | http://d.repec.org/n?u=RePEc:arx:papers:2011.06281&r=all |
| By: | Ann S. O’Malley; Eugene C. Rich; Lisa Shang; Tyler Rose; Arkadipta Ghosh; Dmitriy Poznyak; Deborah Peikes; Matt Niedzwiecki |
| Abstract: | The authors calculated practice†site†level comprehensiveness measures (new problem management and involvement in patient conditions) across 5286 primary care physicians (PCPs) at 1339 practices in the Comprehensive Primary Care initiative evaluation in 2013. |
| Keywords: | comprehensiveness , health services utilization and costs , Medicare , primary health care , quality measures |
| URL: | http://d.repec.org/n?u=RePEc:mpr:mprres:508402a4faf74369ab7ed2f47ce72776&r=all |
| By: | Timiryanova, Venera; Zimin, Aleksandr |
| Abstract: | The article presents the results of the analysis of mortality in municipalities in conjunction with the development of the health care system in the regions using the methods of hierarchical analysis. The study was conducted on the basis of data from 260 municipal districts and urbans of 6 regions of the Russian Federation. The results showed a significant influence on the mortality rate of such factors: wages of the population and the number of doctors in municipalities and the cost of providing outpatient medical care in the regions. В статье представлены результаты анализа смертности в муниципальных образованиях в увязке с развитием системы здравоохранения методами иерархического анализа. Исследование проводилось по данным 260 муниципальных районов и городских округов 6 субъектов РФ. Результаты показали значимое влияние среднемесячной заработной платы населения и численности врачей и расходов на оказание амбулаторной медицинской помощи на уровень смертности. |
| Keywords: | mortality, health care system, municipalities, hierarchical analysis, interregional differences (смертность населения, система здравоохранения, муниципальные образования, иерархический анализ, межрегиональные различия). |
| JEL: | I19 R11 |
| Date: | 2020–11–14 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:104159&r=all |