State regulation and the structure,conduct, efficiency and performance of US auto insurers

This research investigates the impact of regulation on state automobile insurance markets while controlling for other state insurance market characteristics that may be related to performance. Data for a large sample of insurers are analyzed. The results suggest that insurers in competitive and non-stringently regulated states may benefit from market power by charging higher unit prices, however insurers in these states are on average more cost X-efficient and cost X-efficient insurers charge lower prices and earn smaller profits. The empirical results also suggest that insurers in some rate regulated states are less revenue and cost-scale efficient than in competitive states.     

An Efficiency-Based Approach to Determining Potential Cost Savings and Profit Targets for Health Insurers: The Case of Obamacare Health Insurance CO-OPs

This research analyzes the performance of the health insurance consumer-operated and -oriented plan (CO-OPs), examines their medical services and operating efficiency, proposes an efficiency-based goal-oriented approach for cost reductions, profit targets, premium changes, and government subsidies, and provides an important guide for improvement potentials for both the CO-OP health insurance model and other health insurers. The CO-OPs are not satisfactory in the medical services efficiency, and they are much less efficient compared with other insurers. Potential cost reductions are significant using various (conservative) efficiency goals. Most CO-OPs suffer underwriting losses, as do many other insurers; a few CO-OPs are much more operating efficient than other insurers, but all CO-OPs need significant improvement of financial performance relative to benchmark insurers. Incorporating potential cost reductions, many CO-OPs would barely require any “premium changes and government subsidies,” and they are even capable of paying back the federal loans. With both potential cost reductions and premium increases, more CO-OPs would not need any help from the government but survive on their own. This research informs public debates and all stakeholders (including management, consumers, regulators, policymakers) of improvement potentials to be considered for related decision making besides other factors including the political environment and government policies.     

Health insurance--a challenge in India

In India, indemnity health insurance started about 3 decades ago. Mediclaim was the most popular product. Indian insurers and multinational companies have not been enthusiastic about starting health insurance in spite of the availability of a good market because health insurers have historically incurred losses. Losses have been caused by poor administration. Because it is a small portion of their total businesses, insurers have never tried sincerely to improve deficiencies or taken special interest. Hospital management and medical specialists have the spirit of entrepreneurship and are prepared to learn quickly and follow managed care principles, though they are not currently practiced in India. Actuarial data from the health insurance industry is sparse, but data from alternative sources will be helpful for starting managed healthcare. In my opinion, if properly administered, a "limited" managed care product with appropriate precautions and premium levels will be successful and profitable and will compete with present indemnity products in India.     

Consumer Response to a National Marketplace for Individual Health Insurance

The objective of this analysis is to simulate the difference between national and state‐specific individual insurance markets on take‐up of individual health insurance. This simulation analysis was completed in three steps. First, we reviewed the literature to characterize the state‐specific individual insurance markets with respect to state regulations and to identify the effect of those regulations on health insurance premiums. Second, we used empirical data to develop premium estimates for the simulation that reflect case‐mix as well as state‐specific differences in health care markets. Third, we used a revised version of the 2005 Medical Expenditure Panel Survey (MEPS) to complete a set of simulations to identify the impact of three different scenarios for national market development. (National market estimates are based on the simulation model with competition among all 50 states and moderate impact assumptions.) We find evidence of a significant opportunity to reduce the number of uninsured under a proposal to allow the purchase of health insurance across state lines. The best scenario to reduce the uninsured, numerically, is competition among all 50 states with one clear winner. The most pragmatic scenario, with a good impact, is one winner in each regional market.     

Issuance Decisions and Strategic Focus: The Case of Long-Term Care Insurance

Increasing costs of long-term care are placing ever greater burdens on state and federal budgets, yet private long-term care insurance remains a relatively minor financing vehicle. Although many researchers provide rationales for the limited private market, some life–health insurers have forged ahead into this relatively new and risky line of business. We investigate what makes these insurers different and whether managers are following a diversification or strategic focus strategy. We find that strategic focus is a consistently important factor and that managers' participation and volume decisions are made independently.     

Production Efficiency in the Austrian Insurance Industry: A Bayesian Examination

This paper examines the developments in the production efficiency of the Austrian insurance market for the period 1994‐1999 using firm‐specific data on life/health and non‐life insurers obtained from the Austrian insurance regulatory authority. The article uses a Bayesian stochastic frontier to obtain aggregate and firm‐specific estimates of production efficiency across insurer types and time. The study provides strong evidence that the process of deregulation had positive effects on the production efficiency of Austrian insurers. The life/health and non‐life firms showed similar patterns of development in that they were less efficient during the years 1994‐1996 and significantly more efficient in 1997‐1999. If the Austrian experience is representative, similar benefits from deregulation may be expected for the Central and Eastern European countries that prepare for the accession to the European Union.     

论互助保险公司在法国医疗保险制度中的作用

法国的医疗保险制度较好的保障了法国人民的健康状况和生活质量,在世界上享有良好的声誉。本文在介绍了法国医疗保险的财政支持的基础上,分析了互助保险公司在法国医疗保险制度运行中所发挥的重要作用,并以MGEN（法国最大的互助保险公司）为例,介绍了其建立原则、历史沿革、经济模型、覆盖的医疗服务及其发展的评估,探讨了其完善和促进法国卫生保障事业的功效,同时也缓和了社会不平等现象。基于互助保险公司非盈利、联盟和责任感的价值观,MGEN还在眼科医疗方面提供更多的服务。     

Effizienz und Eigentümerstruktur: Eine empirische Analyse des deutschen Lebensversicherungsmarktes

We provide new insights into the effect of ownership on efficiency by analyzing the German life insurance market over the period 2002–2005. Previous research on alternative organizational forms in the life insurance industry has focused on stock and mutual ownership only. Due to the uniqueness of the German insurance market, where privately-owned companies face competition by public insurers, we add to the recent literature the well known debate on public versus private ownership, by investigating stock, mutual and public ownership forms. Using traditional DEA, we calculate technical efficiency and cost efficiency scores to test the efficient structure hypothesis as well as the expense preference hypothesis. Our results give strong support to the latter, while we find no evidence that public ownership is an efficient corporate structure for life insurers. The group of stock firms dominates both, mutual and public insurers, although differences between stock and mutual companies are smaller than differences between stock and public firms. Analyzing within-group results, our findings suggest that high efficiency scores can be associated with certain firm characteristics which are publicly available: high returns on assets, low cancellation rates and low costs.     

Die niederländische Gesundheitsreform 2006 – Vorbild für eine weitere Reform des Krankenversicherungswesens in Deutschland?

The health sector of many European countries has been subject of a profound process of change for years. Since the federal elections of 2009 a discussion on the direction of the German health insurance system has emerged. In this context, German neighboring countries like Switzerland or the Netherlands are considered due to their changes in health policy for decades. This work deals with the effects of the recent Dutch health care reform. Due to the combination of the two elements “Bürgerversicherung” and “Kopfpauschale”, it serves as a possible model for further reform in the German health system since its introduction in 2006. Special attention was paid to the consolidation of statutory and private insurance in a general citizens insurance in the Netherlands “three-pillar model”. Because of the medium-term time horizon, financial impacts on state and private households and changes in competition between insured individuals, insurers and providers could be analysed. Especially, positive effects in terms of increasing competition and reducing the two-tier health care became apparent.     

Examining the Marginal Access Value of Private Health Insurance

According to a new theory advanced by Nyman (1999, 2003) , an important access motivation underlies the demand for health insurance. However, little empirical research has attempted to quantify and explain changes in the access value of health insurance. By assuming the demand for health insurance is derived from the demand for good health, this article shows mathematically that the marginal access value of private health insurance can be reasonably indexed by dividing the price of health insurance by a composite measure of medical prices. For the period from 1960 through 2002, national data for the United States suggests that the marginal access value of private health insurance has tended to increase over time. Based upon multiple regression analysis, marginal access value is shown to have increased over time in response to rising income, more generous benefit coverage, new medical technologies, and, in recent years, the backlash against health maintenance organizations (HMOs). In addition, expansions in the Medicaid program are shown to have slowed the growth of the marginal access value of private health insurance.     

Health insurers' operations in the face of health care reform: An analysis of the Supplemental Health Care Exhibit

The Patient Protection and Affordable Care Act (ACA) introduced significant changes to the health insurance marketplace in the United States. The act also imposed reporting requirements on insurers. The law has required insurers since 2010 to file yearly the Supplemental Health Care Exhibit (SHCE). The SHCE provides unique information on how health insurers operate. We analyze data in the SCHE to understand how insurers have complied with one of the major new regulations affecting health insurers' operations arising from the ACA—the Medical Loss Ratio (MLR) Provision. This requires that insurers spend a minimum percentage of their premium revenue on medical claims, quality improvement expenses, and deductible fraud and abuse detection and recovery expenses. Our analysis of the 2010–2017 SHCE indicates that insurers' underwriting performance worsened in the early years of the ACA as they worked to increase MLRs to become ACA‐compliant. Analysis of the SHCE further reveals that insurers' profits from managing uninsured plans grew as the profitability of underwriting insured plans decreased. Future research on health insurer operations is warranted. The currently underutilized and data‐rich SHCE provides unique information that makes future research possible.     

Spillover effects of increased health insurance enrollment on workers’ compensation insurance

The Patient Protection and Affordable Care Act (ACA) was designed to increase the accessibility and affordability of health insurance. While the ACA did not contain direct provisions related to workers’ compensation (WC), because health‐related coverage is a significant portion of WC costs, the ACA could have unintentionally impacted the WC market. Specifically, expanded health insurance enrollment could reduce WC losses and result in higher performance among insurers participating in the WC market. Using insurer‐state level data, we consider the impact of increased health insurance enrollment on the performance of property‐casualty (PC) insurers. Utilizing multiple measures of performance, we find that the post‐ACA period is generally associated with greater profitability for PC insurers operating in the WC market, a positive unintended consequence of this federal regulation.     

Foreign Share, Insurance Density, and Penetration: An Analysis of the International Life Insurance Market

Recent trends toward liberalization and deregulation have sparked significant interest in the topic of international insurers' participation in foreign markets. This research develops a profile of foreign national market characteristics that attract international life insurer participation and additionally, empirically assesses the value that international participation has to the host market. Characteristics that are found to be statistically significant with respect to international participation include high levels of trade liberalization and/or low insurer market share concentration, high levels of national wealth, and high levels of government expenditure on social security retirement benefits. With respect to the benefits such participation provides, we see that the presence of international life insurers share positive relationships with both life insurance consumption and the magnitude of the role life insurance plays within the broader national economy of those host markets.     

保险人与保险中介人之间的信息不对称问题研究

保险人与保险中介人之间由于期望效用不一致、信息资源不充分等原因导致了信息不对称,对保险人造成负面影响的是代理人隐瞒行为型信息不对称。要解决保险人与保险中介人之间的信息不对称,一方面应加强保险人与保险中介人自身的内部约束,另一方面应建立利益趋同机制和保险信用评级制度。     

Performance of the Life Insurance Industry Under Pressure: Efficiency,Competition, and Consolidation

This article investigates efficiency and competition in the Dutch life insurance market by estimating unused scale economies and measuring efficiency‐market share dynamics during 1995–2010. Large unused scale economies exist for small‐ and medium‐sized life insurers, indicating that further consolidation would reduce costs. Over time average scale economies decrease but substantial differences between small and large insurers remain. A direct measure of competition confirms that competitive pressure is lower than in other markets. We do not observe any impact of increased competition from banks, the so‐called investment policy crisis or the credit crisis, apart from lower returns in 2008.     

Ökonomische Überlegungen zur Rationierung im Gesundheitswesen

This contribution first recalls the fact that binding budgets imposed by policy makers induce rationing, which in its turn by superseding the price mechanism causes inefficiencies in the market for medical services. In addition, inefficiencies spill over into the market for health insurance providing in-kind benefits, while possibly benefiting reimbursement health insurance. But then, the commodity ‘rationing’ itself has a market; indeed, the mere existence of health insurance creates demand for rationing that even increases over time. The contribution concludes with a listing of instruments at the disposal of health insurers designed to make the insured opt for policies with self-limitation features. Thus, insurers can help to reduce that demand for rationing and the inefficiencies that come with it.     

Restructuring of the Dutch Nonlife Insurance Industry: Consolidation,Organizational Form,and Focus

Since the deregulation of the European insurance market in 1994, Dutch nonlife insurance firms have sized up and increased their focus. Concurrently, the stock organizational form has become increasingly dominant. This article investigates these 1995–2005 trends from a cost‐efficiency perspective. We observe substantial economies of scale that are even larger for smaller firms. In line with the efficient structure hypothesis, both stocks and mutuals are found to have comparative cost advantages. Supporting the strategic focus hypothesis, we find that more specialized insurers have lower costs. Thick frontier efficiency estimates point to large cost X‐inefficiencies that have moderately decreased over time.     

Medicaid coverage expansions and liability insurance

Do changes in the population covered by health insurance affect liability insurers, who compensate billions of dollars in medical claims each year? We examine this question by exploiting the selective rollout across states of Medicaid expansions under the Affordable Care Act. Using data on insurer losses across a range of insurance lines, and employing a triple‐difference research design that contrasts states, years, and lines of insurance, we demonstrate that coverage expansions reduce auto liability and workers’ compensation outlays by 6–11 percent, but do not measurably impact other lines of insurance. Our analysis provides some of the first evidence regarding the use of the tort system particularized to the low‐income population and is the first to consider the impacts of health insurance on medical professional liability and commercial auto insurance claims.     

An Empirical Investigation of Market Structure, Efficiency, and Performance in Property-Liability Insurance

This study examines the relationships among market structure and performance in property‐liability insurers over the period 1992–1998 using data at the company and group levels. Three specific hypotheses are tested: traditional structure‐conduct‐performance, relative market power, and efficient structure (ES). The results provide support for the ES hypothesis. The ES hypothesis posits that more efficient firms can charge lower prices than competitors, enabling them to capture larger market shares and economic rents, leading to increased concentration. Both revenue and cost efficiency are used in the analysis, and this is the first study to use revenue efficiency in this type of analysis. The results for the sample period as a whole and by year are consistent. The overall results suggest that cost‐efficient firms charge lower prices and earn higher profits, in conformance with the ES hypothesis. On the other hand, prices and profits are found to be higher for revenue‐efficient firms. Revenue X‐efficiency is derived from activities such as cross‐selling and may rely heavily on the use of detailed information from customer databases to identify potential customers. The implications of this research are that regulators should be more concerned with efficiency (both cost and revenue) rather than the market power that arises from the consolidation activity taking place in insurance.     

政府购买医疗保障服务政策下商业健康保险的盈利模式

新医改提出政府向商业健康保险公司购买医疗保障管理服务的思路,为私营医疗保险市场的进一步发展提供了政策支持。但医改方案公布后,除人保健康进入这一市场外,其他公司仍举旗观望,提供该类服务的公司寥寥无几。这一困境出现的原因是保险机构对政府购买经办服务政策下,相关产品组合的盈利模式缺乏认识。对可得的有限数据进行分析,期望总结中...