Data and Code for: Price-Linked Subsidies and Imperfect Competition in Health Insurance

Principal Investigator(s):  View help for Principal Investigator(s) Mark Shepard, Harvard University. Kennedy School of Government.; Sonia Jaffe, Microsoft

Version:  View help for Version V1

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  Data 11/08/2019 11:09:AM
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  Scripts 12/17/2019 10:27:AM
  Tables 11/08/2019 11:11:AM
README.txt text/plain 16.3 KB 12/17/2019 05:32:AM

Project Citation: 

Shepard, Mark, and Jaffe, Sonia. Data and Code for: Price-Linked Subsidies and Imperfect Competition in Health Insurance. Nashville, TN: American Economic Association [publisher], 2020. Ann Arbor, MI: Inter-university Consortium for Political and Social Research [distributor], 2020-07-23. https://doi.org/10.3886/E115405V1

Project Description

Summary:  View help for Summary
Policymakers subsidizing health insurance often face uncertainty about future market prices. We study the implications of one policy response: linking subsidies to prices, to target a given post-subsidy premium. We show that these price-linked subsidies weaken competition, raising prices for the government and/or consumers. However, price-linking also ties subsidies to health care cost shocks, which may be desirable. Evaluating this tradeoff  empirically, using a model estimated with Massachusetts insurance exchange data, we find that price-linking increases prices 1-6%, and much more
in less competitive markets. For cost uncertainty reasonable in a mature market, these losses outweigh the benefits of price-linking.
Funding Sources:  View help for Funding Sources Harvard University; United States Department of Health and Human Services. National Institutes of Health. National Institute on Aging (T32-AG000186); National Science Foundation (Graduate Research Fellowship)

Scope of Project

Subject Terms:  View help for Subject Terms health insurance; competition; subsidy
JEL Classification:  View help for JEL Classification
      I11 Analysis of Health Care Markets
      I13 Health Insurance, Public and Private
Geographic Coverage:  View help for Geographic Coverage Massachusetts, USA
Time Period(s):  View help for Time Period(s) 2007 – 2011
Data Type(s):  View help for Data Type(s) census/enumeration data; program source code

Methodology

Data Source:  View help for Data Source Public data: Census (ACS)
Restricted data: Massachusetts Health Connector

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Published Versions

V1 [2020-07-23]

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