Does greater Medicare HMO enrollment cause adverse selection into Medigap?
Author InfoDESMOND, KATHERINE A. RICE, THOMAS FOX, PETER D. Abstract This paper examines the interaction between public and private insurance in the context of the US Medicare program, which serves those aged 65 and older as well as the disabled who meet specific eligibility requirements. Specifically, the paper examines the extent to which increasing enrollment in Medicare managed care (which provides more comprehensive coverage than basic Medicare) influences premiums in the privately purchased Medicare supplemental insurance market (called Medigap ). We employ a fixed effects instrumental variables approach to analyze the association between premiums charged by two large Medigap insurers and Medicare HMO penetration rates, examining over 60 geographic areas during the period 1994 2000. It is hypothesized that greater Medicare HMO penetration will lead to adverse selection into the Medigap market, resulting in higher premiums. The findings suggest a moderate upward effect on premiums
Related Questions
- I will be turning 65 in a few weeks. Can you please explain the open enrollment for Medicare supplement (Medigap) insurance policies?
- I am enrolled in a Medicare health maintenance organization (HMO). Should I buy a Medigap policy to help pay my health care costs?
- Does greater Medicare HMO enrollment cause adverse selection into Medigap?
