Pooling Health Insurance Risks

by Pauly, Mark V.; Herring, Bradley

• ISBN13: 9780844741192
• ISBN10: 0844741191
• Format: Hardcover
• Copyright: 1999-09-01
• Publisher: Natl Book Network

Summary

Uncertainty about risks to health virtually requires that people have health insurance. But how is the cost of premiums determined? Should rates vary according to some indicators of risk? How much do premiums vary with risk? Do the young and the healthy actually subsidize the old and the unhealthy?

Author Biography

Mark Pauly is the Bendheim Professor of Health Care Systems at the Wharton School, University of Pennsylvania. Bradley Herring is a Ph.D. candidate at the Wharton School, University of Pennsylvania.

Table of Contents

Acknowledgments	ix
Introduction	1	(11)
Purpose	1	(2)
Three Different Markets	3	(2)
Risk Sharing and Voluntary Markets	5	(3)
The Efficiency Conundrum	8	(1)
Conclusion	9	(3)
Conventional Views of Risk Pooling: What Do We Know and What Should We Expect?	12	(16)
What Do We Think We Know about Health Insurance Markets?	12	(2)
What Does the Conventional Wisdom Imply?	14	(2)
The Magic of Employment-based Group Insurance	16	(1)
Imposed Exclusions and Chosen Limitations	16	(1)
Access and Cost in Different Markets	17	(1)
The Nongroup Market	17	(2)
The Small-Group Market	19	(1)
Variation in Risk Pooling across Markets	19	(7)
Group Insurance: A First Look	26	(1)
Conclusion	27	(1)
A Comparative Study of the Relationship between Risk and Insurance Premiums	28	(26)
The Data	28	(1)
What Constitutes Evidence of Risk Rating?	29	(1)
What Really Happens?	30	(3)
How Much Risk Pooling?	33	(19)
Choosing Insurance	52	(2)
The Effect of Risk on Insurance Purchasing and Wages	54	(17)
Risk and Insurance Purchasing	55	(9)
Wage Incidence and Risk in Group Insurance	64	(7)
The Effect of the Tax Subsidy on Risk Pooling	71	(13)
Toward a Model	74	(4)
Who Wins?	78	(3)
Efficiency of Employment-based Groups and the Tax Subsidy	81	(2)
Conclusion	83	(1)
Conclusions and Implications	84	(9)
What Isn't Necessarily So	84	(2)
What Probably Is So	86	(1)
Getting a Grip	87	(1)
Toward a Big-Picture Policy	88	(4)
Setting Priorities	92	(1)
Notes	93	(2)
References	95