Moral Hazard in Health Insurance: Do Dynamic Incentives Matter?

  title={Moral Hazard in Health Insurance: Do Dynamic Incentives Matter?},
  author={Aviva Aron-Dine and Liran Einav and Amy N. Finkelstein and Mark R. Cullen},
  journal={Review of Economics and Statistics},
Abstract Using data from employer-provided health insurance and Medicare Part D, we investigate whether health care utilization responds to the dynamic incentives created by the nonlinear nature of health insurance contracts. We exploit the fact that because annual coverage usually resets every January, individuals who join a plan later in the year face the same initial (“spot”) price of health care but a higher expected end-of-year (“future”) price. We find a statistically significant response… Expand
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