This chapter summarizes the many aspects of public policy for health care. I first consider government policy affecting individual behaviors. Government intervention to change individual actions such as smoking and drinking is frequently justified on externality grounds. External costs of...

A famous idea to maintain affordable health expenditures is to cut back statutory health insurance (SHI) to a basic insurance and to introduce supplementary private health insurance (PHI), permitted to cover the remaining benefits and to apply managed care mechanisms. The measure is supposed to...

A famous idea to maintain affordable health expenditures is to cut back statutory health insurance (SHI) to a basic insurance and to introduce supplementary private health insurance (PHI), permitted to cover the remaining benefits and to apply managed care mechanisms. The measure is supposed to...

I consider the popular argument of Medicaid crowding out demand for private long-term care insurance. I show that this argument rests on a wrong counterfactual comparison. Furthermore, I question the welfare-decreasing impact of Medicaid as it neglects a large value of the program in providing...

Since 2006, Taiwan's National Health Insurance (NHI) covers the full cost of baseline treatment in cardiac stents (bare-metal stents, BMS), but requires patients to pay the incremental cost of more expensive treatments (drug-eluting stents, DES). Within this "top-up" design, we study how...

Provider cost-control incentives have become an important part of the health insurance landscape in the United States. These incentives are strongest in capitated managed care organizations, especially HMOs, because such organizations are paid a fixed amount regardless of the spending they...

We assess the quantitative importance of reclassification risk in the US health insurance market. Reclassification risk arises because the health conditions of individuals evolve over time, while a typical health insurance contract only lasts for one year. Thus, a change in the health status can...

I take advantage of regulatory and pricing dynamics in Medicare Part D to empirically explore interactions among adverse selection, switching costs, and regulation. I first document novel evidence of adverse selection and switching costs within Part D using detailed administrative data. I then...

Health care entitlement programs in the U.S. represent a large and growing financial outlay for taxpayers. In the pursuit of operational efficiencies, program administrators often contract with private managed care organizations (MCOs) to procure insurance for beneficiaries. This, however,...

This paper studies redistributional effects of competition between private and public insurance on health insurance markets based on the example of Germany. Health insurance is provided by a budget-balancing public insurance and a revenue-maximizing private insurance; customers are characterized...