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Updated: Jun 4, 2025
08:24
The Joint Effect of Social Comparison and Social Distance on Evaluation of Intertemporal Choice Outcomes in Event-related Potential Studies
Published on: August 25, 2023
634
Equity and efficiency effects of flat premiums.
1Department of Economics, Saint Joseph's University, 5600 City Avenue, Philadelphia, PA, 19131, USA.
International Journal of Health Economics and Management
|December 20, 2024
Summary
Flat premiums in regulated markets increase cross-subsidization, impacting equity and efficiency. This shift simplifies regulation but introduces policy trade-offs for different income groups.
Area of Science:
- Health Economics
- Market Regulation
- Public Policy
Background:
- Regulated markets often use risk-adjusted premiums.
- Shifting to flat premiums can alter market dynamics.
- Understanding the impact on different socioeconomic groups is crucial.
Purpose of the Study:
- To analyze the equity and efficiency implications of flat premiums.
- To compare flat premiums against risk-adjusted models.
- To assess the effects on various income groups within a regulated market.
Main Methods:
- Theoretical modeling of premium structures.
- Empirical analysis of market data.
- Examination of cross-subsidization effects.
Main Results:
- Flat premiums can lead to increased cross-subsidization.
- Both market equity and efficiency are notably affected.
- Simplification of the regulatory framework is observed.
Conclusions:
- Flat premiums present a trade-off between regulatory simplicity and market outcomes.
- Policymakers must carefully weigh the distributional consequences.
- Further consideration of equity and efficiency impacts is warranted.
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