A Simple Model of Health Insurance Competition
Dresden University of Technology - Faculty of Economics and Business Management
April 26, 2011
This paper investigates competition between health insurance companies under different financing regulations. We consider two alternatives advanced in recent German health care reform discussions: competition by contribution rates (health contributions) and by fees (health premia). We find that contribution rate competition yields lower company profits and higher consumer welfare than premia competition when switching between insurance companies is costly.
Number of Pages in PDF File: 24
Keywords: Health Care Reform, Competition, Consumer Choice
JEL Classification: I11, I18, D43
Date posted: April 27, 2011