Download or read book Identification of Adverse Selection and Moral Hazard written by Delger Enkhbayar and published by . This book was released on 2015 with total page pages. Available in PDF, EPUB and Kindle. Book excerpt:
Download or read book Moral Hazard Adverse Selection and Health Expenditures written by Patrick Bajari and published by . This book was released on 2013 with total page 0 pages. Available in PDF, EPUB and Kindle. Book excerpt: Theoretical models predict asymmetric information in health insurance markets may generate inefficient outcomes due to adverse selection and moral hazard. However, previous empirical research has found it difficult to disentangle adverse selection from moral hazard in health care. We empirically study this question by a using unique data set with confidential information from a large self-insured employer to estimate a structural model of the demand for health insurance and medical care. We propose a two-step semi-parametric estimation strategy that builds on the work on identification and estimation of auction models. We find significant evidence of moral hazard and adverse selection.
Download or read book Moral Hazard in Health Insurance written by Amy Finkelstein and published by Columbia University Press. This book was released on 2014-12-02 with total page 161 pages. Available in PDF, EPUB and Kindle. Book excerpt: Addressing the challenge of covering heath care expenses—while minimizing economic risks. Moral hazard—the tendency to change behavior when the cost of that behavior will be borne by others—is a particularly tricky question when considering health care. Kenneth J. Arrow’s seminal 1963 paper on this topic (included in this volume) was one of the first to explore the implication of moral hazard for health care, and Amy Finkelstein—recognized as one of the world’s foremost experts on the topic—here examines this issue in the context of contemporary American health care policy. Drawing on research from both the original RAND Health Insurance Experiment and her own research, including a 2008 Health Insurance Experiment in Oregon, Finkelstein presents compelling evidence that health insurance does indeed affect medical spending and encourages policy solutions that acknowledge and account for this. The volume also features commentaries and insights from other renowned economists, including an introduction by Joseph P. Newhouse that provides context for the discussion, a commentary from Jonathan Gruber that considers provider-side moral hazard, and reflections from Joseph E. Stiglitz and Kenneth J. Arrow. “Reads like a fireside chat among a group of distinguished, articulate health economists.” —Choice
Download or read book Moral Hazard and Adverse Selection in Private Health Insurance written by David Powell and published by . This book was released on 2014 with total page 0 pages. Available in PDF, EPUB and Kindle. Book excerpt: Moral hazard and adverse selection create inefficiencies in private health insurance markets. The authors use claims data from a large firm to study the independent roles of both moral hazard and adverse selection. Previous studies have attempted to estimate moral hazard in private health insurance by assuming that individuals respond only to the spot price, end-of-year price, average price, or a related metric. There is little economic justification for such assumptions and, in fact, economic intuition suggests that the nonlinear budget constraints generated by health insurance plans make these assumptions especially poor. They study the differential impact of the health insurance plans offered by the firm on the entire distribution of medical expenditures without parameterizing the plans by a specific metric. They use a new instrumental variable quantile estimation technique introduced in Powell (2013b) that provides the quantile treatment effects for each plan, while conditioning on a set of covariates for identification purposes. This technique allows us to map the resulting estimated medical expenditure distributions to the nonlinear budget sets generated by each plan. Their method also allows them to separate moral hazard from adverse selection and estimate their relative importance. They estimate that 77% of the additional medical spending observed in the most generous plan in their data relative to the least generous is due to adverse selection. The remainder can be attributed to moral hazard. A policy which resulted in each person enrolling in the least generous plan would cause the annual premium of that plan to rise by over $1,500.
Download or read book Adverse selection moral hazard and entry written by Anthony Creane and published by . This book was released on 1995 with total page 33 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Download or read book Disentangling Moral Hazard and Adverse Selection in Private Health Insurance written by and published by . This book was released on 2016 with total page pages. Available in PDF, EPUB and Kindle. Book excerpt: Moral hazard and adverse selection create inefficiencies in private health insurance markets and understanding the relative importance of each factor is critical for policy. We use claims data from a large firm to isolate moral hazard from plan selection. Previous studies have attempted to estimate moral hazard in private health insurance by assuming that individuals respond only to the spot price, end-of-year price, expected price, or a related metric. The nonlinear budget constraints generated by health insurance plans make these assumptions especially poor and we statistically reject their appropriateness. We study the differential impact of the health insurance plans offered by the firm on the entire distribution of medical expenditures without assuming that individuals only respond to a parameterized price. Our empirical strategy exploits the introduction of new plans during the sample period as a shock to plan generosity, and we account for sample attrition over time. We use an instrumental variable quantile estimation technique that provides quantile treatment effects for each plan, while conditioning on a set of covariates for identification purposes. This technique allows us to map the resulting estimated medical expenditure distributions to the nonlinear budget sets generated by each plan. We estimate that 53% of the additional medical spending observed in the most generous plan in our data relative to the least generous is due to moral hazard. The remainder can be attributed to adverse selection. A policy which resulted in each person enrolling in the least generous plan would cause the annual premium of that plan to rise by $1,000.
Download or read book Disentangling Adverse Selection Moral Hazard and Supply Induced Demand written by Vincenzo Atella and published by . This book was released on 2018 with total page 66 pages. Available in PDF, EPUB and Kindle. Book excerpt: In the healthcare sector, Selection (S), Moral Hazard (MH) and Supply Induced Demand (SID) are three very important phenomena affecting patients' behavior. Despite there exists a vast theoretical and empirical literature on these phenomena, so far, no contribution has been able to approach them jointly. This is mostly due to difficulties in modelling the joint determinants of health service utilization and health insurance choice by means of a tractable structural simultaneous equation model. In this paper, we provide a solution to this problem and estimate a simultaneous four equation structural model with four latentvariables, where the first two equations are meant to deal with the adverse selection issue, while the third and fourth equation deal with moral hazard and SID issues. By doing so, our model seeks to identify causal effects while correcting for selection and endogeneity with the observational data we have. A closed form solution for the likelihood function - which guarantees an exact solution - is maximized via FIML, using a large cross-sectional dataset collected by the Italian national institute of statistic (ISTAT). The empirical analysis has con rmed the theoretical predictions of our structural model. In particular, we find evidence of selection in the choice of private insurance and SID, but do not find MH behavior on the patient side. These results are extremely important from a health policy perspective, given the existing international debate on the development of a second pillar in the fi nancing of the healthcare system.
Download or read book Separating Moral Hazard from Adverse Selection and Learning in Automobile Insurance written by Georges Dionne and published by . This book was released on 2008 with total page 0 pages. Available in PDF, EPUB and Kindle. Book excerpt: The identification of information problems in different markets is a challenging issue in the economic literature. This paper performs tests of residual asymmetric information in the French automobile insurance market for the 1995-1997 period. This market is characterized by the presence of a regulated experience-rating scheme (bonus-malus). Contract choices are strongly associated with the bonus-malus of policyholders. We have access to longitudinal survey data with dynamic information both on claims and accidents. We propose a causality test to distinguish pathways through which a positive correlation arises between contract choice and accidents. We find evidence of moral hazard among a sub-group of policyholders with significant driving experience (5-15 years). We distinguish this moral hazard estimate from adverse selection and learning. Policyholders with less experience have a combination of learning and moral hazard, whereas no residual information problem is found for policyholders with more than 15 years of experience.
Download or read book Adverse Selection and Moral Hazard with Risk neutral Agent written by Roger Guesnerie and published by . This book was released on 1986 with total page 22 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Download or read book Adverse Selection and Moral Hazard with Risk neutral Agent written by and published by . This book was released on 1980 with total page 22 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Download or read book Adverse Selection and Moral Hazard in a Repeated Elections Model written by Jeffrey S. Banks and published by . This book was released on 1991 with total page 24 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Download or read book What is Wrong with Moral Hazard and Adverse Selection Problems in the Conventional Economic Theory written by Bertrand Claude Lemennicier and published by . This book was released on 2014 with total page 0 pages. Available in PDF, EPUB and Kindle. Book excerpt: The purpose of this paper is to challenge the conventional theory of moral hazard and adverse selection. Moral hazard and adverse selection problems in contemporary economic theory are plagued with four major flaws: 1) the alleged asymmetrical information between buyer and seller as a problem in the coordination process of the market; 2) the confusion between di fferent concepts or defi nitions of probability: case or class probabilities, pure subjective beliefs on the occurrence of an event or relative prices on betting markets; 3) the presupposed inability of actors (sellers and buyers) to solve by themselves the problems they face, 4) the pretense of economists to be able to correct these so-called market failures with compulsory insurance without creating new moral hazard and/or adverse selection problems worse than the ones they want to cure. We center our paper mainly on the internal and theoretical inconsistency of the canonical model developed by Akerlof and Rothschild and Stiglitz's theory and their followers based on additive or non additive expected utility associated with the subjective versus frequency tradition in statistics. As an alternative, we propose to approach these phenomena through the eye glasses of betting markets an securitization of insurance contracts.
Download or read book The Impact of Other regarding Preferences on Moral Hazard and Adverse Selection written by Thomas Daske and published by . This book was released on 2017 with total page 0 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Download or read book Dealing with Moral Hazard and Adverse Selection Simultaneously written by Georges Dionne and published by . This book was released on 1988 with total page 62 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Download or read book Adverse Selection and Moral Hazard Issues in the Market for Corporate Control written by S. Nagarajan and published by . This book was released on 1987 with total page 129 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Download or read book Testing for Adverse Selection with unused Observables written by Amy Finkelstein and published by . This book was released on 2006 with total page 35 pages. Available in PDF, EPUB and Kindle. Book excerpt: This paper proposes a new test for adverse selection in insurance markets based on observable characteristics of insurance buyers that are not used in setting insurance prices. The test rejects the null hypothesis of symmetric information when it is possible to find one or more such "unused observables" that are correlated both with the claims experience of the insured and with the quantity of insurance purchased. Unlike previous tests for asymmetric information, this test is not confounded by heterogeneity in individual preference parameters, such as risk aversion, that affect insurance demand. Moreover, it can potentially identify the presence of adverse selection, while most alternative tests cannot distinguish adverse selection from moral hazard. We apply this test to a new data set on annuity purchases in the United Kingdom, focusing on the annuitant's place of residence as an "unused observable." We show that the socio-economic status of the annuitant's place of residence is correlated both with annuity purchases and with the annuitant's prospective mortality. Annuity buyers in different communities therefore face different effective insurance prices, and they make different choices accordingly. This is consistent with the presence of adverse selection. Our findings also raise questions about how insurance companies select the set of buyer attributes that they use in setting policy prices. We suggest that political economy concerns may figure prominently in decisions to forego the use of some information that could improve the risk classification of insurance buyers.
Download or read book Truth about Moral Hazard and Adverse Selection written by Mark V. Pauly and published by . This book was released on 2007 with total page 23 pages. Available in PDF, EPUB and Kindle. Book excerpt:
