Are Health Insurance Markets Competitive?

  title={Are Health Insurance Markets Competitive?},
  author={Leemore S. Dafny},
  journal={The American economic review},
  volume={100 4},
To gauge the competitiveness of the group health insurance industry, I investigate whether health insurers charge higher premiums, ceteris paribus, to more profitable firms. Such "direct price discrimination" is feasible only in imperfectly competitive settings. Using a proprietary national database of health plans offered by a sample of large, multisite firms from 1998–2005, I find firms with positive profit shocks subsequently face higher premium growth, even for the same health plans… CONTINUE READING


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