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...

This article examines a model of competition between two types of health insurer: Health Maintenance Organizations (HMOs) and nonintegrated insurers. HMOs vertically integrate health care providers and pay them at a competitive price, while nonintegrated health insurers work as indemnity plans...

This paper examines the impact of managed care on the local hospital market structure. During the 1990s, managed care increased its presence rapidly in the healthcare market, and local hospital markets became more concentrated through closures and mergers. Despite the clear-cut observational...

Recent healthcare reforms have sought to increase efficiency by introducing managed care (MC) while respecting consumer preferences by admitting choice between MC and conventional care. This article proposes an institutional change designed to let German consumers choose between the two settings...

Private insurance firms participating in Medicare can offer up to three principal plan types: coordinated care plans (CCPs), prescription drug plans (PDPs), and private fee for service (PFFS) plans. Firms can make entry and marketing decisions separately across plan types and geographic regions....

We provide a modeling framework to think about selective contracting in the health care sector. Two health care providers differ in quality and costs. When buying health insurance, consumers observe neither provider quality nor costs. We derive an equilibrium where health insurers signal...

We provide a modeling framework to think about selective contracting in the health care sector. Two health care providers differ in quality and costs. When buying health insurance, consumers observe neither provider quality nor costs. We derive an equilibrium where health insurers signal...

This paper examines a model of competition between two types of health insurers: Managed Care Organizations (MCOs) and “Conventional Insurers." MCOs vertically integrate health care providers and pay them at a competitive price, while conventional insurers work as indemnity plans and pay the...

The previous decade witnessed a consumer “backlash” against cost-reducing models of health insurance that restrict consumers' decision rights and choices. In this paper I test the hypothesis that consumers' positive valuation of provider choice lead to a flight from HMO enrollments in the...

This paper estimates the impact of the introduction of Medicaid managed care (MMC) on the formal Medicaid participation of children. We employ a quasi-experimental approach exploiting the location-specific timing of MMC implementation in Kentucky. Using data from the March Current Population...