Findings from Erasmus University Provides New Data about Managed Care (Switching gains and health plan price elasticities: 20 years of managed…

Findings from Erasmus University Provides New Data about Managed Care (Switching gains and health plan price elasticities: 20 years of managed competition reforms in The Netherlands)

By a News Reporter-Staff News Editor at Managed Care Weekly Digest -- Data detailed on Managed Care have been presented. According to news reporting originating in Rotterdam, Netherlands, by NewsRx journalists, research stated, "In this paper we estimate health plan price elasticities and financial switching gains for consumers over a 20-year period in which managed competition was introduced in the Dutch health insurance market. The period is characterized by a major health insurance reform in 2006 to provide health insurers with more incentives and tools to compete, and to provide consumers with a more differentiated choice of products."

The news reporters obtained a quote from the research from Erasmus University, "Prior to the reform, in the period 1995-2005, we find a low number of switchers, between 2 and 4% a year, modest average total switching gains of 2 million euros per year and short-term health plan price elasticities ranging from -0.1 to -0.4. The major reform in 2006 resulted in an all-time high switching rate of 18%, total switching gains of 130 million euros, and a high short-term price elasticity of -5.7. During 2007-2015 switching rates returned to lower levels, between 4 and 8% per year, with total switching gains in the order of 40 million euros per year on average. Total switching gains could have been 10 times higher if all consumers had switched to one of the cheapest plans. We find short-term price elasticities ranging between -0.9 and -2.2."

According to the news reporters, the research concluded: "Our estimations suggest substantial consumer inertia throughout the entire period, as we find degrees of choice persistence ranging from about 0.8 to 0.9."

For more information on this research see: Switching gains and health plan price elasticities: 20 years of managed competition reforms in The Netherlands. European Journal of Health Economics, 2017;18(8):1047-1064. European Journal of Health Economics can be contacted at: Springer, 233 Spring St, New York, NY 10013, USA. (Springer - www.springer.com; European Journal of Health Economics - www.springerlink.com/content/1618-7598/)

Our news correspondents report that additional information may be obtained by contacting R. Douven, Erasmus University, IBMG, Rotterdam, Netherlands. Additional authors for this research include K. Katona, F.T. Schut and V. Shestalova (see also Managed Care).

Keywords for this news article include: Rotterdam, Netherlands, Europe, Health Insurance, Managed Care, Erasmus University.

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