Cost-sharing is regarded as an important tool to reduce moral hazard in health insurance. Contrary to standard … implications of different insurance designs. I find cost-sharing never to be an optimal solution as it produces two novel …

, individuals are free to increase their deductible and thereby reduce their insurance premium. In order to distinguish between … deductibles of 1,500 CHF and 2,500 CHF (1CHF = 1$) per calendar year. While there is a minimum deductible level in Switzerland … change in 2005 that introduced the higher deductible for the first time. The results show that selection leads to …

internalities justify government action. I then turn to markets for medical care and health insurance. Virtually all governments … provide health insurance for some part of the population. Governments face several fundamental choices in this provision. The … at the expense of quality. A second choice is in the degree of cost sharing. More generous insurance reduces the utility …

Health insurance premiums often do not reflect individual health risks, implying redistribution from individuals with … that was in place was a 350 euro deductible. Our counterfactual experiments show that redistribution would decrease when … the deductible would increase. Nonetheless, high-risk individuals can benefit from higher levels of cost-sharing. The …