Open Enrollment Periods and Plan Choices

38 Pages Posted: 3 Jan 2018 Last revised: 3 Jul 2023

See all articles by Francesco Decarolis

Francesco Decarolis

Bocconi University - Department of Economics

Andrea Guglielmo

University of Wisconsin - Madison

Calvin Luscombe

Boston University

Date Written: December 2017

Abstract

Open enrollment periods are pervasively used in insurance markets to limit adverse selection risks resulting when enrollees can switch plans at will. We exploit a change in the open enrollment rules of Medicare Advatage to analyze how beneficiaries responded to the option of switching to a 5-star rated plan at anytime, in a setting where insurers adjusted premiums and benefit design to counterbalance the increased selection risk. We present three findings: within-year switches to 5-star plans increase by 7-16%; demand for 5-star plans across the years does not change; the enrollees who switch to a 5-star plan during the year are in better health status than those who do not switch.

Suggested Citation

Decarolis, Francesco and Guglielmo, Andrea and Luscombe, Calvin, Open Enrollment Periods and Plan Choices (December 2017). NBER Working Paper No. w24156, Available at SSRN: https://ssrn.com/abstract=3095117

Francesco Decarolis (Contact Author)

Bocconi University - Department of Economics ( email )

Via Gobbi 5
Milan, 20136
Italy

Andrea Guglielmo

University of Wisconsin - Madison ( email )

716 Langdon Street
Madison, WI 53706-1481
United States

Calvin Luscombe

Boston University

595 Commonwealth Avenue
Boston, MA 02215
United States

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