Pietro Tebaldi, University of Chicago: Estimating Equilibrium in Health Insurance Exchanges: Price Competition and Subsidy Design under the ACA

Department seminar. Pietro Tebaldi is Assistant Professor at the University of Chicago. He will present the paper "Estimating Equilibrium in Health Insurance Exchanges: Price Competition and Subsidy Design under the ACA".

Pietro Tebaldi. Photo: University of Chicago.

Abstract:

 

To design premium subsidies in a health insurance market it is necessary to estimate consumer demand and study how different subsidy schemes affect insurers’ incentives. Combining data from the Californian ACA marketplace with a model of insurance demand and insurers’ competition, I identify and estimate demand and cost primitives, and assess equilibrium outcomes under alternative subsidy designs. I find that vouchers are less distortionary than subsidies calculated from market premiums, and — given age-heterogeneity in demand and cost — tailoring subsidies to age leads to an equilibrium where all buyers are better off and per-person public spending is lower.

 

Host: Matteo Alpino

Published Sep. 12, 2016 2:07 PM - Last modified June 28, 2018 11:22 AM