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Does It Matter If Your Health Insurer Is For Profit? Effects of Ownership on Premiums, Insurance Coverage, and Medical Spending

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2019-02-01

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10.1257/pol.20130370

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American Economic Association
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Dafny, Leemore S. "Does It Matter If Your Health Insurer Is For Profit? Effects of Ownership on Premiums, Insurance Coverage, and Medical Spending." American Economic Journal: Economic Policy 11, no. 1 (February 2019): 222–265.

Abstract

There is limited empirical evidence about the impact of for-profit health insurers on various outcomes. I study the effects of conversions to for-profit status by Blue Cross and Blue Shield (BCBS) affiliates in 11 states, spanning 28 geographic markets. I find both the BCBS affiliate and its rivals increased premiums following conversions in markets where the converting affiliate had substantial market share. Medicaid enrollment rates also increased in these markets, a pattern consistent with “crowd in” of families who were formerly privately insured. The results suggest for-profit insurers are likelier than not-for-profit insurers to exercise market power when they possess it. (JEL G22, I13, I18, I38)

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General Economics, Econometrics and Finance

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This article is made available under the terms and conditions applicable to Open Access Policy Articles (OAP), as set forth at Terms of Service

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https://nrs.harvard.edu/URN-3:HUL.INSTREPOS:37367769

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