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.

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.