Adverse selection and consumer inertia: empirical evidence from the Dutch health insurance market.

This paper examines to what extent consumer inertia can reduce adverse selection in health insurance markets. To this end, we investigate consumer choice of deductible in the Dutch health insurance market over the period 2013-2018, using panel data based on a large random sample (266 k) of all insured individuals in the Netherlands. The Dutch health insurance market offers a unique setting for studying adverse selection, because during annual open enrollment periods all adults are free to choose an extra deductible up to 500 euro per year.

Aligning Ambition and Reality: A Multiple Case Study Into Synergistic Influences of Financial and Other Factors on the Outcomes of Integrated Care Projects.

Introduction: While the benefits of integrated care are widely acknowledged, its implementation has proven difficult. Together with other factors, financial factors are known to influence progress towards care integration, but in-depth insight in their influence on the envisioned outcomes of integrated care projects is limited.

Methods: We conducted a multiple case study of four integrated care projects in the Netherlands.

Preconditions for efficiency and affordability in competitive healthcare markets: Are they fulfilled in Belgium, Germany, Israel, the Netherlands and Switzerland? Ten years later.

From the mid-1990s several countries have introduced elements of the model of regulated competition in healthcare. In 2012 we assessed the extent to which in five countries ten important preconditions for achieving efficiency and affordability in competitive healthcare markets were fulfilled. In this paper we assess to what extent the fulfilment of these preconditions has changed ten years later.

Financing COVID-19-related health care costs in the Dutch competitive health system during 2020 and 2021: Overall experiences and policy recommendations for improving health system resilience.

The Dutch health system is based on the principles of managed (or regulated) competition, meaning that competing risk bearing insurers and providers negotiate contracts on the price, quantity and quality of care. The COVID-19 pandemic caused a huge external shock to the health system which potentially distorted the conditions required for fair competition. Therefore, an important question is to what extent was the competitive Dutch health system resilient to the financial shock caused by the pandemic? Overall, the Dutch competitive health system proved to be sufficiently flexible and resilient at absorbing the financial shock caused by the COVID-19 pandemic in 2020 and 2021 due to an effective combination of regulatory and self-regulatory measures.

Changing roles of health insurers in France, Germany, and the Netherlands: any lessons to learn from Bismarckian systems?

Bismarckian health systems are mainly governed by social health insurers, but their role, status, and power vary across countries and over time. We compare the role of health insurers in three distinct social health insurance systems in improving health systems' efficiency. In France, insurers work together as a single payer within a highly regulated context.

Financial risk allocation and provider incentives in hospital-insurer contracts in The Netherlands.

In healthcare systems with a purchaser-provider split, contracts are an important tool to define the conditions for the provision of healthcare services. Financial risk allocation can be used in contracts as a mechanism to influence provider behavior and stimulate providers to provide efficient and high-quality care. In this paper, we provide new insights into financial risk allocation between insurers and hospitals in a changing contracting environment.

Do health insurers use target marketing as a tool for risk selection? Evidence from the Netherlands.

In health care systems based on managed competition, enrolees can choose between insurers who are positioned as prudent buyers of care on their behalf. To avoid risk selection, insurers are compensated through a system of risk equalisation. The Dutch system of risk equalisation is generally considered to be one of the most sophisticated in the world.

Strategic cost-shifting in long-term care. Evidence from the Netherlands.

With the reform in 2015 of the system of long-term care (LTC) in the Netherlands, responsibilities for the provision of social support and assistance were delegated from the central government to the municipalities. Unintentionally, the way municipalities are financed created incentives to shift cost from the local level back to central level. In this paper we examine whether municipalities respond to the prevailing financial incentives by shifting costs to the public LTC insurance scheme.

Cooperation amongst insurers on enhancing quality of care: precondition or substitute for competition?

In health care systems based upon managed competition, insurers are expected to negotiate with providers about price and quality of care. The Dutch experience, however, shows that quality plays a limited role in insurer-provider negotiations. It has been suggested that this is partly due to a lack of cooperation among insurers.

Does price deregulation in a competitive hospital market damage quality?

Regulators may be hesitant to permit price competition in healthcare markets because of its potential to damage quality. We assess whether this fear is well founded by examining a reform that permitted Dutch health insurers to freely negotiate prices with hospitals. Unlike previous research on hospital competition that has relied on quality indicators for urgent treatments, we take advantage of a plausible absence of selection bias to identify the effect on the quality of elective procedures that should be more price responsive.

Price effects of a hospital merger: Heterogeneity across health insurers, hospital products, and hospital locations.

In most studies on hospital merger effects, the unit of observation is the merged hospital, whereas the observed price is the weighted average across hospital products and across payers. However, little is known about whether price effects vary between hospital locations, products, and payers. We expand existing bargaining models to allow for heterogeneous price effects and use a difference-in-differences model in which price changes at the merging hospitals are compared with price changes at comparison hospitals.

Who will become my co-residents? The role of attractiveness of institutional care in the changing demand for long-term care institutions.

Background: In several OECD countries the percentage of people over 80 in LTC institutions has been declining for more than a decade, despite population ageing. The standard model to explain healthcare utilization, the Andersen model, cannot explain this trend. We extend the Andersen model by including proxies for the relative attractiveness of community living compared to institutional care.

The 2015 long-term care reform in the Netherlands: Getting the financial incentives right?

In 2015 the system of long-term care (LTC) financing and provision in the Netherlands was profoundly reformed. The benefits covered by the former comprehensive public LTC insurance scheme were split up and allocated to three different financing regimes. The objectives of the reform were to improve the coordination between LTC, medical care and social care, and to reinforce incentives for an efficient provision of care by making risk-bearing health insurers and municipalities responsible for procurement.

Managed competition in the Netherlands: Do insurers have incentives to steer on quality?

In health care systems based on managed competition, insurers are expected to negotiate with providers about price, quantity, and quality of care. The Dutch experience shows that this expectation may be justified with regard to price and quantity, but for quality the results are less conclusive. To examine the incentives insurers face for enhancing quality of care, we conducted in-depth interviews with CEOs and organised separate focus groups with purchasers and marketers of five Dutch health insurers.

Value-based provider payment: towards a theoretically preferred design.

Worldwide, policymakers and purchasers are exploring innovative provider payment strategies promoting value in health care, known as value-based payments (VBP). What is meant by 'value', however, is often unclear and the relationship between value and the payment design is not explicated. This paper aims at: (1) identifying value dimensions that are ideally stimulated by VBP and (2) constructing a framework of a theoretically preferred VBP design.

Trends in ageing and ageing-in-place and the future market for institutional care: scenarios and policy implications.

In several OECD countries the percentage of elderly in long-term care institutions has been declining as a result of ageing-in-place. However, due to the rapid ageing of population in the next decades future demand for institutional care is likely to increase. In this paper we perform a scenario analysis to examine the potential impact of these two opposite trends on the demand for institutional elderly care in the Netherlands.

Can universal access be achieved in a voluntary private health insurance market? Dutch private insurers caught between competing logics.

For almost a century, the Netherlands was marked by a large market for voluntary private health insurance alongside state-regulated social health insurance. Throughout this period, private health insurers tried to safeguard their position within an expanding welfare state. From an institutional logics perspective, we analyze how private health insurers tried to reconcile the tension between a competitive insurance market pressuring for selective underwriting and actuarially fair premiums (the insurance logic), and an upcoming welfare state pressuring for universal access and socially fair premiums (the welfare state logic).

Switching gains and health plan price elasticities: 20 years of managed competition reforms in The Netherlands.

In this paper we estimate health plan price elasticities and financial switching gains for consumers over a 20-year period in which managed competition was introduced in the Dutch health insurance market. The period is characterized by a major health insurance reform in 2006 to provide health insurers with more incentives and tools to compete, and to provide consumers with a more differentiated choice of products. Prior to the reform, in the period 1995-2005, we find a low number of switchers, between 2 and 4% a year, modest average total switching gains of 2 million euros per year and short-term health plan price elasticities ranging from -0.

Competition policy for health care provision in the Netherlands.

In the Netherlands in 2006 a major health care reform was introduced, aimed at reinforcing regulated competition in the health care sector. Health insurers were provided with strong incentives to compete and more room to negotiate and selectively contract with health care providers. Nevertheless, the bargaining position of health insurers vis-à-vis both GPs and hospitals is still relatively weak.

What health plans do people prefer? The trade-off between premium and provider choice.

Within a healthcare system with managed competition, health insurers are expected to act as prudent buyers of care on behalf of their customers. To fulfil this role adequately, understanding consumer preferences for health plan characteristics is of vital importance. Little is known, however, about these preferences and how they vary across consumers.

Switching health insurers: the role of price, quality and consumer information search.

We examine the impact of price, service quality and information search on people's propensity to switch health insurers in the competitive Dutch health insurance market. Using panel data from annual household surveys and data on health insurers' premiums and quality ratings over the period 2006-2012, we estimate a random effects logit model of people's switching decisions. We find that switching propensities depend on health plan price and quality, and on people's age, health, education and having supplementary or group insurance.

Tackling hospital waiting times: the impact of past and current policies in the Netherlands.

This paper reviews the impact of health policies on hospital waiting times in the Netherlands over the last two decades. During the 1990s hospital waiting times increased as a result of the introduction of fixed budgets and capacity constraints for specialists, in addition to the fixed global hospital budgets that were already in place since the 1980s. To tackle these increased waiting times over the years 2000-2011 several policies were implemented, including a change from fixed budgets to activity-based funding--for both hospitals and specialists--and increased competition among hospitals.

Do patients choose hospitals with high quality ratings? Empirical evidence from the market for angioplasty in the Netherlands.

A necessary condition for competition to promote quality in hospital markets is that patients are sensitive to differences in hospital quality. In this paper we examine the relationship between hospital quality, as measured by publicly available quality ratings, and patient hospital choice for angioplasty using individual claims data from a large health insurer. We find that Dutch patients have a high propensity to choose hospitals with a good reputation, both overall and for cardiology, and a low readmission rate after treatment for heart failure.

The impact of geographic market definition on the stringency of hospital merger control in Germany and the Netherlands.

In markets where hospitals are expected to compete, preventive merger control aims to prohibit anticompetitive mergers. In the hospital industry, however, the standard method for defining the relevant market (SSNIP) is difficult to apply and alternative approaches have proven inaccurate. Experiences from the United States show that courts, by identifying overly broad geographic markets, have underestimated the anticompetitive effects of hospital mergers.