Managed competition in practice: Lessons for healthcare policy

This dissertation contributes to a better understanding of the health insurance markets in managed competition setting by discussing potential market failures and policy interventions. After the introduction of Chapter 1, Chapter 2 measures price elasticity in the Netherlands before and after the health insurance reforms in 2006. Chapter 3 provides evidence for adverse selection in the Dutch health insurance market due to voluntary deductibles. Chapter 4 illustrates the welfare effects of increased degree of substitution in the health insurance market using a theoretical model. Chapter 5 explores the incentives for and welfare effects of vertical integration and exclusive behavior between health insurers and hospitals in a theoretical model. Finally, Chapter 6 studies the effect of financing the healthcare expenditures through insurance (rather than directly out of packet) on the hospital merger analyses. The empirical studies (Chapter 2 and 3) use data from the Netherlands. Nonetheless, the main conclusions and the theoretical models (Chapter 4, 5 and 6) can also be applied to other health care systems based on the principles of managed competition.