Reducing delivery insurance costs through risk score model for food delivery company

In this paper, we propose a novel pricing model for delivery insurance in a food delivery company in Latin America, with the aim of reducing the high costs associated with the premium paid to the insurer. To achieve this goal, a thorough analysis was conducted to estimate the probability of losses based on delivery routes, transportation modes, and delivery drivers' profiles. A large amount of data was collected and used as a database, and various statistical models and machine learning techniques were employed to construct a comprehensive risk profile and perform risk classification. Based on the risk classification and the estimated probability associated with it, a new pricing model for delivery insurance was developed using advanced mathematical algorithms and machine learning techniques. This new pricing model took into account the pattern of loss occurrence and high and low-risk behaviors, resulting in a significant reduction of insurance costs for both the contracting company and the insurer. The proposed pricing model also allowed for greater flexibility in insurance contracting, making it more accessible and appealing to delivery drivers. The use of estimated loss probabilities and a risk score for the pricing of delivery insurance proved to be a highly effective and efficient alternative for reducing the high costs associated with insurance, while also improving the profitability and competitiveness of the food delivery company in Latin America.

Employer-Sponsored Health Insurance Premium Cost Growth and Its Association With Earnings Inequality Among US Families

Importance

Costs of employer-sponsored health care benefits have increased faster than workers' wages for several decades, with important implications for disparities in earnings and wage stagnation.

Objective

To quantify how growth in employer-sponsored health insurance (ESI) premiums may have been associated with reduced annual wages, disparities in earnings by race and ethnicity and wage level, and wage stagnation among US families with ESI.

Design, Setting, and Participants

In this economic evaluation, serial cross-sectional analyses were performed of US families receiving ESI from 1988 to 2019 based on data from the Consumer Expenditure Survey, Kaiser Employer Health Benefits Survey, US Census Bureau's Current Population Survey, and federal payroll taxation rates. Statistical analysis was conducted from February 2022 to July 2023.

Main Outcomes and Measures

Percentage of annual compensation associated with health care premiums (after accounting for tax deductibility) and lost wages associated with growth in cost of premiums from 1989 to 2019 based on 1988 compensation. To assess disparities, analyses were stratified by race and ethnicity and wage level.

Results

In 1988, 44.7 million individuals (head of household: mean [SD] age, 43.3 [13.1] years; 30.1% were female; and 2.4% identified as Asian, 6.2% as Hispanic, 8.6% as non-Hispanic Black, and 82.8% as non-Hispanic White) were covered by ESI family plans; this number remained similar in 2019 at 44.8 million individuals (head of household: mean [SD] age, 47.1 [12.9] years; 41.3% were female; and 1.3% identified as Asian, 9.9% as Hispanic, 9.9% as non-Hispanic Black, and 78.9% as non-Hispanic White). In 1988, the mean (SD) household size was 3.3 (1.3) people, and in 2019, it was 3.4 (1.3) people. If ESI costs had remained at the same proportion of the 1988 average compensation package, then in 2019, the median US family with ESI could have earned $8774 (95% CI, $8354-$9195) more in annual wages. During all 32 years, health care premiums as a percentage of compensation were greater for non-Hispanic Black and Hispanic families than for non-Hispanic White families. By 2019, 13.8% (95% CI, 13.5%-14.1%) of compensation among non-Hispanic White families with ESI went to premium costs compared with 19.2% (95% CI, 18.8%-19.7%) among non-Hispanic Black families and 19.8% (19.3%-20.3%) among Hispanic families with ESI. In 2019, health care premiums as a percentage of compensation at the 95th percentile of earnings for families with ESI were 3.9% (95% CI, 3.8%-4.0%) compared with 28.5% (95% CI, 27.8%-29.2%) at the 20th percentile of earnings. From 1988 to 2019, the mean cumulative lost earnings associated with growth in health care premiums for the median US family with ESI was $125 340 (95% CI, $120 155-$130 525) in 2019 dollars, 4.7% of earnings over the 32-year period.

Conclusions and Relevance

This economic evaluation of US families receiving ESI suggests that 3 decades of increasing health care premiums were likely associated with reduced annual earnings and increased earnings inequality by race and ethnicity and wage level and were meaningfully associated with wage stagnation.

[Rehabilitation for Post-COVID Syndrome covered by the German Pension Insurance in 2021]

AIM OF THE STUDY

The present work is intended to give an overview of rehabilitation of patients with post COVID-19 condition covered by the German Pension Insurance in 2021.

METHODS

Cross-sectional analysis of medical rehabilitation completed in 2021, in which COVID-19 sequelae were coded in first or second place in the uniform discharge report according to the International Statistical Classification of Diseases and Related Health Problems was carried out. The codes U08(.9), U09(.9) and U10(.9) as well as the corresponding codes from 2020 were taken into the evaluation as COVID-19-related diseases. Children's rehabilitation and oncological rehabilitation for pensioners and their relatives were excluded. Statistically, relative and absolute frequencies are given for nominal and ordinal variables, and median and quartiles for continuous, skewed distributed variables.

RESULTS

9,666 rehabilitations with one of the codes mentioned in first or second place remained. 54.8% of the patients were women and 43.2% men. The median age was 54 and 55 years (women/men). In all, 64.4% of the rehabilitations were carried out in the pulmonary medicine department. Owing to somatic indications, almost 50% of these patients in rehabilitation remained in the clinic beyond the regular approval period. The most common other diagnoses were diseases of the respiratory system. In 80.7% of those affected, the treating physicians considered the post-COVID-19 condition-associated symptoms as improved through rehabilitation. Furthermore, employment was subject to social security contributions for 88.0% of these patients, and 30.5% were employed in the fields of health, social affairs, teaching, and education. Of those affected, 63.8% were on sick leave when they were admitted, 63.0% when they were discharged. With regard to performance in the last job or on the general job market, over 90.0% received a prognosis for 6 hours and more.

CONCLUSION

The importance of post-COVID-19 condition in the context of medical rehabilitation increased significantly over the course of 2021. The disease causes long periods of disability. With regard to performance, the available analyses give a positive picture; only 6.5% of those individuals undergoing rehabilitation were assessed as having a reduced capacity to earn of less than 3 hours on the general labor market.

Adapting our Flood Risk Policies to Changing Conditions

Flooding causes more damage and severely impacts more people worldwide than any other natural disaster. Flood risk in many parts of the United States is projected to increase due to both continued floodplain development and climate change. Many of our institutions and public policies are not designed to address these changing risk conditions. The practice of grandfathering insurance premiums in the National Flood Insurance Program (NFIP)-allowing an insured to keep a lower rate even when risk has increased-is one such policy. We link a flood hazard model to a flood insurance premium calculator in order to provide illustrative calculations of the possible impact of grandfathering on program revenue and policyholder premiums due to sea level rise for a New York City neighborhood. We conclude by discussing how to preserve the financial soundness of the NFIP while addressing the affordability of insurance in the face of increasing flood risk.

The role of premium subsidies in crop insurance

This study develops a novel framework of heterogeneous producer attitudes towards risk to analyze different, stated and revealed, roles of crop insurance premium subsidies and underlying policy objectives of the government. The analysis reveals a strong connection and a complementarity between the roles of premium subsidies in increasing producer participation in crop insurance, inducing a desired separating equilibrium in the presence of asymmetric information, and transferring income to agricultural producers participating in the program. Developing an alternative design of premium subsidies that can achieve the stated government objective of increased producer participation and induce any desired separating equilibrium at significantly reduced costs, our study rejects the idea that the income redistribution taking place under the current policy design is necessary for increasing producer participation in crop insurance. Indeed, the current policy design reveals that premium subsidies are either a means of income redistribution or a policy failure.

Do state insurance mandates alter ICSI utilization?

BACKGROUND

Assisted reproductive technology (ART) insurance mandates resulted in improved access to infertility treatments like intracytoplasmic sperm injection (ICSI). Our objective was to examine whether ART insurance mandates demonstrate an increased association with ICSI use.

METHODS

In this retrospective cohort study, clinic-specific data for 2000-2016 from the Centers for Disease Control (CDC) were grouped by state and subgrouped by the presence and extent of ART state insurance mandates. Mandated (n = 8) and non-mandated (n = 22) states were compared for ICSI use and male factor (MF) infertility in fresh non-donor ART cycles with a transfer in women < 35 years. Clinical pregnancy (CPR), live birth (LBR) rates, preimplantation genetic testing (PGT), elective single-embryo transfer (eSET) and twin birth rates per clinic were evaluated utilizing Welch's t-test. Pearson correlation was used to measure the strength of association between MF and ICSI; ICSI and CPR, and ICSI and LBR over time. Results were considered statistically significant at a p-value of < 0.05, with Bonferroni correction used for multiple comparisons.

RESULTS

From 2000 to 2016, ICSI use per clinic increased in both mandated and non-mandated states. ICSI use per clinic in non-mandated states was significantly greater from 2011 to 2016 (p < 0.05, all years) than in mandated states. Clinics in mandated states had less MF (30.5 ± 15% vs 36.7 ± 15%; p < 0.001), lower CPR (39.8 ± 4% vs 43.4 ± 4%; p = 0.02) and lower LBR (33.9 ± 3.5% vs 37.9 ± 3.5%; p < 0.05). PGT rates were not significantly different. ICSI use in non-mandated states correlated with MF rates (r = 0.524, p = 0.03). A significant correlation between ICSI and CPR (r = 0.8, p < 0.001) and LBR (r = 0.7, p < 0.001) was noted in mandated states only. eSET rates were greater and twin rates were lower in mandated compared with non-mandated states.

CONCLUSIONS

There was greater use of ICSI per clinic in non-mandated states, which correlated with an increased frequency of MF. In mandated states, lower ICSI rates per clinic were accompanied by a positive correlation with CPR and LBR, as well as a trend for greater eSET rates and lower twin rates, suggesting that state mandates for ART coverage may encourage more selective utilization of laboratory resources.

Why Do Informal Sector Workers Not Pay the Premium Regularly? Evidence from the National Health Insurance System in Indonesia

BACKGROUND

The challenges of universal health coverage (UHC) in developing countries with a significant proportion of the labor force that works in the informal sector include administrative difficulties in recruiting, registering and collecting regular contributions in a cost-effective way. As most developing countries have a limited fiscal space to support the program in the long run, the fiscal sustainability of UHC, such as that in Indonesia, relies heavily on the contributions of its members. The failure of a large proportion of voluntary enrollees/self-enrolled members/informal sector workers (Peserta Mandiri/Pekerja Bukan Penerima Upah [PBPU] members) to pay their premiums may lead to the National Health Insurance System (NHIS) in Indonesia being unable to effectively deliver its services.

OBJECTIVE

This study aims at exploring the important factors that affect the compliance behavior of informal sector workers (PBPU members) in regularly paying their insurance premium. This analysis may be a basis for designing effective measures to encourage payment sustainability in informal sector workers in the NHIS.

METHOD

This study utilizes the survey data collected from three regional offices of the Indonesian Social Security Agency for Health (SSAH), which cover approximately 1210 PBPU members, to understand the relationship between members' characteristics and their compliance behavior regarding the premium payment. We applied an econometric analysis of a logit regression to statistically estimate which factors most affect their compliance behavior in paying the insurance premium.

RESULTS

This study reveals that almost 28% of PBPU members do not pay their insurance premiums in a sustainable way. Our logistic regression statistically confirms that the number of household members, financial hardship, membership in other social protection arrangements, and the utilization of health services are negatively correlated with the compliance rate of informal sector workers in paying their insurance premium. For instance, people who experience financial hardship tend to have a 7.7 percentage point lower probability of routinely paying the premium. In contrast, households that work in agricultural sectors and have income stability, the cost of inpatient care incurred before joining the NHIS, a comprehensive knowledge of the SSAH's services, and the availability of health professionals are all positively correlated with regular premium payment.

CONCLUSION

Although there is no single policy that can ensure that informal sector workers (PBPU members) regularly pay their premiums, this study recommends some policy interventions, including (1) flexibility in applying for a government subsidy for premiums (Penerima Bantuan Iuran [PBI]), especially for people who have financial hardship; (2) an intensive promotion of insurance literacy; (3) expanding the quantity and quality of healthcare services; and (4) tailor-made policies for ensuring the sustainability of premium payments for each regional division.

Out-of-pocket expenses for myasthenia gravis patients in China: a study on patients insured by basic medical insurance in China, 2013-2015

BACKGROUND

Myasthenia gravis is a rare autoimmune neuromuscular disorder. The disorder requires long-term use of expensive medication to control clinical symptoms. This study analyzed the change in trends of total medical expenses and out-of-pocket expenses for patients with myasthenia gravis and explored the factors influencing them.

METHODS

In this retrospective study, data were derived from a survey of medical service utilization for patients insured by the Urban Basic Medical Insurance in China from 2013 to 2015. The cost data of 3347 patients with myasthenia gravis were included in this study. The baseline characteristics and medical expenses for patients with myasthenia gravis were analyzed using a descriptive method. The difference and influencing factors of the out-of-pocket ratio were analyzed from both outpatient and inpatient expenses by using the quantile regression method.

RESULTS

The total expenses reimbursed by the Urban Basic Medicine Insurance for all patients with myasthenia gravis fell progressively from 73.1 to 58.7% during the study period. Patients' out-of-pocket expenses increased gradually, of which expenses within the scope of Basic Medicine Insurance increased from 14.7 to 22.6% and expenses outside of the Basic Medicine Insurance scope increased from 12.6 to 18.7%. Moreover, the panel quantile results showed a positive correlation between the year of receiving treatment and the out-of-pocket ratio. In addition to the 25th quantile of the out-of-pocket ratio among outpatients with myasthenia gravis, there were significant differences in medical insurance and medical institution among all the other quantiles. Significant regional differences were found in all quantiles of the out-of-pocket ratio, except for the 75th quantile among inpatients. Lastly, age had a negative effect on inpatients with myasthenia gravis across all quantiles, but not on outpatients.

CONCLUSIONS

From 2013 to 2015, patients with myasthenia gravis's out-of-pocket expenses increased progressively. Moreover, the individual out-of-pocket ratio was affected by the year, medical insurance, medical institution, region, and age. The current medical insurance policy for the general public has a low ability to cater for patients with myasthenia gravis.

Traumatic spinal cord injury in West Virginia: Disparities by insurance and discharge disposition from an acute care hospital

Context: Medicaid has been linked to worse outcomes in a variety of diagnoses such as lung cancer, uterine cancer, and cardiac valve procedures. It has furthermore been linked to the reduced health-related quality of life outcomes after traumatic injuries when compared to other insurance groups. In spinal cord injury (SCI), the care provided in the subacute setting may vary based upon payor status, which may have implications on outcomes and cost of care.Design: A retrospective review utilizing the institutional trauma databank was performed for all adult patients with spinal cord injury since 2009. Pediatric patients were excluded. Insurance type, race, length of stay, discharge status (alive/dead), discharge disposition, injury severity score (ISS), and hospital charges billed were recorded.Results: Two hundred patients were identified. Overall 27.5% of patients with SCI during the period of our review were Medicaid beneficiaries. ISS was similar between Medicaid and non-Medicaid patients, but the Medicaid beneficiaries were younger (37 vs 50 years of age; P < .001). Medicaid beneficiaries had a significantly longer length of stay (20.9 days; P < .001) when compared to all other patients. They furthermore were more likely to be discharged home or to a skilled nursing facility rather than an acute rehabilitation center. Inpatient charges billed for Medicaid beneficiaries were significantly higher than those of non-Medicaid patients (203,264 USD vs 140,114 USD; P = .015), likely reflecting the increased length of stay while awaiting appropriate disposition.Conclusion: Medicaid patients with SCI in West Virginia had a longer hospital stay, higher charges billed, and were more likely to be discharged home or to a skilled nursing facility rather than an acute rehabilitation center, when compared to non-Medicaid patients. The lack of availability of rehabilitation facilities for Medicaid beneficiaries likely explains this difference.

Polarization, Participation, and Premiums: How Political Behavior Helps Explain Where the ACA Works, and Where It Doesn't

CONTEXT

Political partisanship can influence whether individuals enroll in government programs. In particular, Republicans, ceteris paribus, are less likely to enroll in Affordable Care Act (ACA) individual marketplace insurance than Democrats. The logic of adverse selection suggests low uptake among Republicans would generally put upward pressure on marketplace premiums, especially in geographic areas with more Republican partisans.

METHODS

Using data from Healthcare.gov at the rating area level, this article examines the association between Republican vote share and growth in ACA marketplace premiums, being careful to account for potential confounding variables.

FINDINGS

Insurers have increased marketplace premiums at higher rates in areas with more Republican voters. In the preferred model specification, a 10-percentage-point difference in Republican vote share is associated with a 3.2-percentage-point increase in average premium growth for a standard plan. A variety of robustness and placebo checks suggest the relationship is driven by partisanship.

CONCLUSIONS

Partisan polarization can threaten the successful implementation of policies that rely on high levels of citizen participation.

Using telematics data to find risky driver behaviour

Usage-based insurance schemes provide new opportunities for insurers to accurately price and manage risk. These schemes have the potential to better identify risky drivers which not only allows insurance companies to better price their products but it allows drivers to modify their behaviour to make roads safer and driving more efficient. However, for Usage-based insurance products, we need to better understand how driver behaviours influence the risk of a crash or an insurance claim. In this article, we present our analysis of automotive telematics data from over 28 million trips. We use a case control methodology to study the relationship between crash drivers and crash-free drivers and introduce an innovative method for determining control (crash-free) drivers. We fit a logistic regression model to our data and found that speeding was the most important driver behaviour linking driver behaviour to crash risk.

Valuing floodplain protection and avoidance in a coastal watershed

Flood-related losses in the United States are increasing despite large-scale mitigation efforts. To offset the rising cost of floods, the US Congress passed legislation in 2014 that will augment insurance premiums to make the National Flood Insurance Program more actuarially sound. Consequently, there is interest in lowering flood-related costs to the homeowner, both in terms of premiums and damage. This study addresses the issue by integrating premium savings and damages avoided based on several mitigation scenarios. Specifically, it examines how much policyholders within a watershed near Houston, Texas, could have saved between 1999 and 2009 had their communities introduced specific avoidance-based mitigation activities. The results indicate that homeowners and communities can offset premium rises and a majority of the damage suffered through marginal expansions of such initiatives. However, the costs associated with their implementation could counter some of these savings, and hence they need to be considered in future work.

Uterus at a price: Disability insurance and hysterectomy

Taiwanese Labor, Government Employee, and Farmer Insurance programs provide 5 to 6 months of salary to enrollees who undergo hysterectomies or oophorectomies before their 45th birthday. These programs create incentives for more and earlier treatments, referred to as inducement and timing effects. Using National Health Insurance data between 1997 and 2011, we estimate these effects on surgery hazards by difference-in-difference and bunching-smoothing polynomial methods. For Government Employee and Labor Insurance, inducement is 11-12% of all hysterectomies, and timing 20% of inducement. For oophorectomies, both effects are insignificant. Enrollees' behaviors are consistent with rational choices. Each surgery qualifies an enrollee for the same benefit, but oophorectomy has more adverse health consequences than hysterectomy. Induced hysterectomies increase benefit payments and surgical costs, at about the cost of a mammogram and 5 pap smears per enrollee.

Data transformations to improve the performance of health plan payment methods

The conventional method for developing health care plan payment systems uses observed data to study alternative algorithms and set incentives for the health care system. In this paper, we take a different approach and transform the input data rather than the algorithm, so that the data used reflect the desired spending levels rather than the observed spending levels. We present a general economic model that incorporates the previously overlooked two-way relationship between health plan payment and insurer actions. We then demonstrate our systematic approach for data transformations in two Medicare applications: underprovision of care for individuals with chronic illnesses and health care disparities by geographic income levels. Empirically comparing our method to two other common approaches shows that the "side effects" of these approaches vary by context, and that data transformation is an effective tool for addressing misallocations in individual health insurance markets.

Impacts of shifting responsibility for high-cost individuals on Health Insurance Exchange plan premiums and cost-sharing provisions

Insurance companies can respond to increases in expected per-capita healthcare expenditures by adjusting premiums, cost-sharing requirements, and/or plan generosity. We use a Difference-in-Difference model with Plan-level Fixed Effects to estimate the impacts of increases in expected expenditures generated by closure of state-operated High Risk Pools (HRPs). For Silver plans, we find that issuers responded to HRP closures by increasing both premiums and deductibles, and by increasing the ratios of premiums to deductibles. This adjustment to the structure of plan prices is consistent with the hypothesis that issuers will be reluctant to adjust deductibles, because consumers tend to overweight changes in deductibles over changes in premiums. The increase in the ratio of premiums to deductibles indicates that the increase in expected expenditures triggered an increase in the share of total risk-pool healthcare expenditures paid by low healthcare utilizers, and a decrease in the share paid by high utilizers.

'Scarier than another storm': values at risk in the mapping and insuring of US floodplains

How do people respond to the ways in which insurance mediates environmental risks? Socio-cultural risk research has characterized and analyzed the experiential dimension of risk, but has yet to focus on insurance, which is a key institution shaping how people understand and relate to risk. Insurance not only assesses and communicates risk; it also economizes it, making the problem on the ground not just one of risk, but also of value. This article addresses these issues with an investigation of the social life of the flood insurance rate map, the central technology of the U.S. National Flood Insurance Program (NFIP), as it grafts a new landscape of 'value at risk' onto the physical and social world of New York City in the aftermath of Hurricane Sandy. Like other risk technologies, ubiquitous in modern societies as decision-making and planning tools, the map disseminates information about value and risk in order to tame uncertainty and enable prudent action oriented toward the future. However, drawing together interview, ethnographic, and documentary data, I find that for its users on the ground, the map does not simply measure 'value at risk' in ways that produce clear strategies for protecting property values from flooding. Instead, it puts values-beyond simply the financial worth of places-at risk, as well as implicates past, present, and future risks beyond simply flooding. By informing and enlarging the stakes of what needs protecting, and from what, I argue that plural and interacting 'values at risk' shape how people live with and respond to environmental risks that are mediated by insurance technologies.

What are consumers willing to pay for a broad network health plan?: Evidence from covered California

Health Insurance Marketplaces have received considerable attention for their narrow network health plans. Yet, little is known about consumer tastes for network breadth and how they affect plan selection. I estimate demand for health plans in California's Marketplace, Covered California. Using 2017 individual enrollment data and provider network directories, I develop a geospatial measure of network breadth that reflects the physical locations of households and network providers. I find that households are sensitive to network breath in their plan choices. Mean willingness to pay for a broad network plan relative to a narrow network plan, defined as a two standard deviation, 17.44 percentage point increase in network breadth, is $45.83 in post-subsidy monthly premiums. Variation in WTP indicates a selection mechanism exists whereby older households sort into broader network plans. I also find that households are highly premium sensitive, which may be a result of plan standardization in Covered California.

Integrated assessment of short-term direct and indirect economic flood impacts including uncertainty quantification

Understanding and quantifying total economic impacts of flood events is essential for flood risk management and adaptation planning. Yet, detailed estimations of joint direct and indirect flood-induced economic impacts are rare. In this study an innovative modeling procedure for the joint assessment of short-term direct and indirect economic flood impacts is introduced. The procedure is applied to 19 economic sectors in eight federal states of Germany after the flood events in 2013. The assessment of the direct economic impacts is object-based and considers uncertainties associated with the hazard, the exposed objects and their vulnerability. The direct economic impacts are then coupled to a supply-side Input-Output-Model to estimate the indirect economic impacts. The procedure provides distributions of direct and indirect economic impacts which capture the associated uncertainties. The distributions of the direct economic impacts in the federal states are plausible when compared to reported values. The ratio between indirect and direct economic impacts shows that the sectors Manufacturing, Financial and Insurance activities suffered the most from indirect economic impacts. These ratios also indicate that indirect economic impacts can be almost as high as direct economic impacts. They differ strongly between the economic sectors indicating that the application of a single factor as a proxy for the indirect impacts of all economic sectors is not appropriate.

Provider-owned insurers in the individual market

OBJECTIVES

To describe the number and availability of individual market plans sold by provider-owned insurers and compare differences in premiums between traditional and provider-owned insurers.

STUDY DESIGN

Cross-sectional analysis.

METHODS

Using the Robert Wood Johnson Foundation's HIX Compare data, we identified insurers selling Affordable Care Act (ACA)-compliant policies in the individual market and identified those insurers owned by health systems by using information on their websites. We determined the number of insurers selling policies in each market and the size of the population living in areas where provider-owned insurers sold plans in 2016 and 2017. We used least squares regression to compare premiums between traditional and provider-owned insurers within markets, and we adjusted standard errors for clustering at the market and insurer level.

RESULTS

There were 149 insurers that sold ACA-compliant plans in 2017, of which 51 were provider owned. Provider-owned insurers operated in 208 of the 503 exchange markets. We estimate that about 62% of US residents (more than 170 million people) live in a market in which a provider-owned insurer sells plans. Premiums did not differ significantly between traditional and provider-owned plans in 2017.

CONCLUSIONS

Provider-owned insurers play a prominent role in the individual insurance market. Although health systems that sell insurance have incentives to reduce costs, provider-owned insurers and traditional insurers have similar premiums.

Does experience rating reduce sickness and disability claims? Evidence from policy kinks

We study whether the experience rating of employers' disability insurance premiums affects the inflow to disability benefits in Finland. To identify the causal effect of experience rating, we exploit kinks in the rule that specifies the degree of experience rating as a function of firm size. Using comprehensive matched employer-employee panel data, we estimate the effects of experience rating on the inflow to sickness and disability benefits. We find that experience rating has little or no effect on either of these outcomes.

Paying more for less? Insurer competition and health plan generosity in the Medicare Advantage program

This paper explores the relationship between insurer competition and health plan benefit generosity by examining the impact of a regulatory change that caused the cancellation of 40% of the private plans in Medicare. I isolate cancellation's causal effect by using variation induced by insurers canceling all plans nationally. Results show that insurers in markets affected by cancellation reduced the benefit generosity of the plans remaining in the market. In the average market, out-of-pocket costs for a representative beneficiary enrolled in plans not directly affected by the policy increased by $91 annually. In the least competitive markets, out-of-pocket costs increased by roughly $64-$127 a year for enrollees in those plans. Meanwhile in the most competitive markets, benefit generosity barely changed. These findings have crucial implications for markets such as health insurance exchanges, as they suggest that plan generosity is degraded when competition declines.

Earthquake insurance pricing: a risk-based approach

Flat earthquake premiums are 'uniformly' set for a variety of buildings in many countries, neglecting the fact that the risk of damage to buildings by earthquakes is based on a wide range of factors. How these factors influence the insurance premiums is worth being studied further. Proposed herein is a risk-based approach to estimate the earthquake insurance rates of buildings. Examples of application of the approach to buildings located in Taipei city of Taiwan were examined. Then, the earthquake insurance rates for the buildings investigated were calculated and tabulated. To fulfil insurance rating, the buildings were classified into 15 model building types according to their construction materials and building height. Seismic design levels were also considered in insurance rating in response to the effect of seismic zone and construction years of buildings. This paper may be of interest to insurers, actuaries, and private and public sectors of insurance.

Health insurance subsidies and deductible choice: Evidence from regional variation in subsidy schemes

The extent to which premium subsidies can influence health insurance choices is an open question. In this paper, we explore the regional variation in subsidy schemes in Switzerland, designed as either in-kind or cash transfers, to study their impact on the choice of health insurance deductibles. Using health survey data and a difference-in-differences methodology, we find that in-kind transfers increase the likelihood of choosing a low deductible plan by approximately 4 percentage points (or 7%). Our results indicate that the response to in-kind transfers is strongest among women, middle-aged and unmarried individuals, which we explain by differences in risk-taking behavior, health status, financial constraints, health insurance and financial literacy. We discuss our results in the light of potential extra-marginal effects on the demand for health care services, which are however not supported by our data.

Short-term rehospitalization across the spectrum of age and insurance types in the United States

Few studies have examined rates and causes of short-term readmissions among adults across age and insurance types. We compared rates, characteristics, and costs of 30-day readmission after all-cause hospitalizations across insurance types in the US. We retrospectively evaluated alive patients ≥18 years old, discharged for any cause, 1/1/13-11/31/13, 2006 non-federal hospitals in 21 states in the Nationwide Readmissions Database. The primary stratification variable of interest was primary insurance. Comorbid conditions were assessed based on Elixhauser comorbidities, as defined by administrative billing codes. Additional measures included diagnoses for index hospitalizations leading to rehospitalization. Hierarchical multivariable logistic regression models, with hospital site as a random effect, were used to calculate the adjusted odds of 30-day readmissions by age group and insurance categories. Cost and discharge estimates were weighted per NRD procedures to reflect a nationally representative sample. Diagnoses for index hospitalizations leading to rehospitalization were determined. Among 12,533,551 discharges, 1,818,093 (14.5%) resulted in readmission within 30 days. Medicaid insurance was associated with the highest adjusted odds ratio (AOR) for readmission both in those ≥65 years old (AOR 1.12, 95%CI 1.10-1.14; p <0.001), and 45-64 (AOR 1.67, 95% CI 1.66-1.69; p < 0.001), and Medicare in the 18-44 group (Medicare vs. private insurance: AOR 1.99, 95% CI 1.96-2.01; p <0.001). Discharges for psychiatric or substance abuse disorders, septicemia, and heart failure accounted for the largest numbers of readmissions, with readmission rates of 24.0%, 17.9%, 22.9% respectively. Total costs for readmissions were 50.7 billion USD, highest for Medicare (29.6 billion USD), with non-Medicare costs exceeding 21 billion USD. While Medicare readmissions account for more than half of the total burden of readmissions, costs of non-Medicare readmissions are nonetheless substantial. Medicaid patients have the highest odds of readmission in individuals older than age 44, commonly due to hospitalizations for psychiatric illness and substance abuse disorders. Medicaid patients represent a population at uniquely high risk for readmission.

How do Medicare Advantage beneficiary payments vary with tenure?

OBJECTIVES

To compare how premiums and expected out-of-pocket medical costs (OOPC) vary with the length of time Medicare Advantage (MA) beneficiaries have been enrolled in their plans.

STUDY DESIGN

Descriptive and fixed effects regression analyses.

METHODS

Using linked administrative enrollment and plan data, we compared the costs of the MA plans that beneficiaries chose with the costs of other plans available to them. We show predicted values adjusted for age, gender, race/ethnicity, disability, individual health risk, presence of mental health diagnoses, health plan quality, relative size of the plan's provider network, and the number of years continuously enrolled in the same plan. To further address the possibility of bias, we included county-level fixed effects and compared results to a beneficiary-level fixed effects model.

RESULTS

We found average spending on premiums and OOPC in enrolled plans exceeded such costs in the lowest-cost plan by $697 in 2013. Beneficiaries who remained in their plans for 6 or more years were most at risk of spending these higher amounts, paying $786 more than they would have spent in the lowest-cost plan compared with $552 for beneficiaries in their first year of enrollment. For each year a beneficiary remained in their same plan, their additional spending in excess of the minimum cost choice increased by roughly $50.

CONCLUSIONS

MA beneficiaries could reduce their exposure to healthcare spending by switching to plans with lower premiums, although there may well be rational reasons for paying costs in excess of those of the lowest-cost plan.

Understanding the effects of past flood events and perceived and estimated flood risks on individuals' voluntary flood insurance purchase behavior

Over the past several decades, the economic damage from flooding in the coastal areas has greatly increased due to rapid coastal development coupled with possible climate change impacts. One effective way to mitigate excessive economic losses from flooding is to purchase flood insurance. Only a minority of coastal residents however have taken this preventive measure. Using original survey data for all coastal counties of the United States Gulf Coast merged with contextual data, this study examines the effects of external influences and perceptions of flood-related risks on individuals' voluntary behaviors to purchase flood insurance. It is found that the estimated flood hazard conveyed through the U.S. Federal Emergency Management Agency's (FEMA's) flood maps, the intensities and consequences of past storms and flooding events, and perceived flood-related risks significantly affect individual's voluntary purchase of flood insurance. This behavior is also influenced by home ownership, trust in local government, education, and income. These findings have several important policy implications. First, FEMA's flood maps have been effective in conveying local flood risks to coastal residents, and correspondingly influencing their decisions to voluntarily seek flood insurance in the U.S. Gulf Coast. Flood maps therefore should be updated frequently to reflect timely and accurate information about flood hazards. Second, policy makers should design strategies to increase homeowners' trust in the local government, to better communicate flood risks with residents, to address the affordability issue for the low-income, and better inform less educated homeowners through various educational programs. Future studies should examine the voluntary flood insurance behavior across countries that are vulnerable to flooding.

Targeted social protection in a pastoralist economy: case study from Kenya

Social protection programmes are designed to help vulnerable populations - including pastoralists - maintain a basic level of well-being, manage risk, and cope with negative shocks. Theory suggests that differential targeting according to poverty status can increase the reach and effectiveness of budgeted social protection programmes. Chronically poor households benefit most from social protection designed to help them meet their basic needs and make vital investments necessary to graduate from poverty. Vulnerable non-destitute households benefit from protection against costly temporary shocks, but do not necessarily need regular assistance. Welfare gains occur when a comprehensive social protection programme considers the needs of both types of households. The authors use evidence-based understanding of poverty dynamics in the pastoralist-based economy of northern Kenya's arid and semi-arid lands as a case study to discuss and compare the observed impacts of two different social protection schemes on heterogeneous pastoralist households: a targeted, unconditional, cash-transfer programme designed to support the poorest, and an index-based livestock insurance programme, which acts as a productive 'safety net' to help stem a descent into poverty and increase resilience. Both types of social protection scheme have been shown to decrease poverty, improve food security and protect child health. However, the behavioural response for asset accumulation varies with the type of protection and the household's unique situation. Poor households that receive cash transfers retain and accumulate assets quickly. Insured households, who are typically vulnerable yet not destitute, protect existing herds and invest more in the livestock they already own. The authors argue that differential targeting increases programme efficiency, and discuss Kenya's current approach to implementing differentially targeted social protection.

Impact of Medicare Advantage Prescription Drug Plan Star Ratings on Enrollment before and after Implementation of Quality-Related Bonus Payments in 2012

OBJECTIVE

Since 2007, the Centers for Medicare and Medicaid Services have published 5-star quality rating measures to aid consumers in choosing Medicare Advantage Prescription Drug Plans (MAPDs). We examined the impact of these star ratings on Medicare Advantage Prescription Drug (MAPD) enrollment before and after 2012, when star ratings became tied to bonus payments for MAPDs that could be used to improve plan benefits and/or reduce premiums in the subsequent year.

METHODS

A longitudinal design and multivariable hybrid models were used to assess whether star ratings had a direct impact on concurrent year MAPD contract enrollment (by influencing beneficiary choice) and/or an indirect impact on subsequent year MAPD contract enrollment (because ratings were linked to bonus payments). The main analysis was based on contract-year level data from 2009-2015. We compared effects of star ratings in the pre-bonus payment period (2009-2011) and post-bonus payment period (2012-2015). Extensive sensitivity analyses varied the analytic techniques, unit of analysis, and sample inclusion criteria. Similar analyses were conducted separately using stand-alone PDP contract-year data; since PDPs were not eligible for bonus payments, they served as an external comparison group.

RESULT

The main analysis included 3,866 MAPD contract-years. A change of star rating had no statistically significant effect on concurrent year enrollment in any of the pre-, post-, or pre-post combined periods. On the other hand, star rating increase was associated with a statistically significant increase in the subsequent year enrollment (a 1-star increase associated with +11,337 enrollees, p<0.001) in the post-bonus payment period but had a very small and statistically non-significant effect on subsequent year enrollment in the pre-bonus payment period. Further, the difference in effects on subsequent year enrollment was statistically significant between the pre- and post-periods (p = 0.011). Sensitivity analyses indicated that the findings were robust. No statistically significant effect of star ratings was found on concurrent or subsequent year enrollment in the pre- or post-period in the external comparison group of stand-alone PDP contracts.

CONCLUSION

Star ratings had no direct impact on concurrent year MAPD enrollment before or after the introduction of bonus payments tied to star ratings. However, after the introduction of these bonus payments, MAPD star ratings had a significant indirect impact of increasing subsequent year enrollment, likely via the reinvestment of bonuses to provide lower premiums and/or additional member benefits in the following year.

[Payment of out-patient dental service according to tariffs in obligatory insurance system]

Cost price of dental services in system of obligatory medical insurance is higher two fold than officially determined tariffs. Costs of the same services in medical organizations of the same federal region in Russia tend to varyMeasures directed at the stimulation of reduction of expenses connected with the keep of those medical organizations that have increased expenses (compared to other medical organizations) should be considered.

Flood insurance in Canada: implications for flood management and residential vulnerability to flood hazards

Insurance coverage of damage caused by overland flooding is currently not available to Canadian homeowners. As flood disaster losses and water damage claims both trend upward, insurers in Canada are considering offering residential flood coverage in order to properly underwrite the risk and extend their business. If private flood insurance is introduced in Canada, it will have implications for the current regime of public flood management and for residential vulnerability to flood hazards. This paper engages many of the competing issues surrounding the privatization of flood risk by addressing questions about whether flood insurance can be an effective tool in limiting exposure to the hazard and how it would exacerbate already unequal vulnerability. A case study investigates willingness to pay for flood insurance among residents in Metro Vancouver and how attitudes about insurance relate to other factors that determine residential vulnerability to flood hazards. Findings indicate that demand for flood insurance is part of a complex, dialectical set of determinants of vulnerability.

Time and distance to first accident and driving patterns of young drivers with pay-as-you-drive insurance

We conducted a study of approximately 16,000 drivers under the age of 30 that had purchased a pay-as-you-drive insurance policy, where their risk of being involved in a crash was analyzed from vehicle tracking data using a global positioning system. The comparison of novice vs. experienced young drivers shows that vehicle usage differs significantly between these groups and that the time to the first crash is shorter for those drivers with less experience. Driving at night and a higher proportion of speed limit violations reduces the time to the first crash for both novice and experienced young drivers, while urban driving reduces the distance traveled to the first crash for both groups. Gender differences are also observed in relation to the influence of driving patterns on the risk of accident. Nighttime driving reduces the time to the first accident in the case of women, but not for men. The risk of an accident increases with excessive speed, but the effect of speed is significantly higher for men than it is for women among the more experienced drivers.

Trends in out-of-pocket health care expenditures in Canada, by household income, 1997 to 2009

BACKGROUND

Canadian households are spending an increasing share of their household income on health care not covered by public plans. This study investigates trends in out-of-pocket expenditures for health care services and products by household income quintile from 1997 to 2009.

DATA AND METHODS

Biennial estimates from the Survey of Household Spending between 1997 and 2009 were used to examine changes in out-of-pocket health care expenditures, by household income quintile. The statistical significance of these changes was assessed using linear and logistic regression.

RESULTS

In 2009, the percentage of after-tax household income spent on health care among low-income households (5.7%) was nearly twice that of high-income households (2.6%). Approximately 40% of households in the two lowest income quintiles spent more than 5% of their total after-tax income on health care services and products, compared with 14% of households in the highest income quintile. The increase in spending between 1997 and 2009 was greatest for households in the lowest income quintile (63%).

INTERPRETATION

Out-of-pocket health care expenditures have increased for households in all income quintiles, but the relative increase was greatest among households in lower income quintiles.

Service use, charge, and access to mental healthcare in a private Kenyan inpatient setting: the effects of insurance

The gap in Kenya between need and treatment for mental disorders is wide, and private providers are increasingly offering services, funded in part by private health insurance (PHI). Chiromo, a 30-bed psychiatric hospital in Nairobi, forms part of one of the largest private psychiatric providers in East Africa. The study evaluated the effects of insurance on service use and charge, questioning implications on access to care. Data derive from invoices for 455 sequential patients, including 12-month follow-up. Multi-linear and binary logistic regressions explored the effect of PHI on readmission, cumulative length of stay, and treatment charge. Patients were 66.4% male with a mean age of 36.8 years. Half were employed in the formal sector. 70% were admitted involuntarily. Diagnoses were: substance use disorder 31.6%; serious mental disorder 49.5%; common mental disorder 7%; comorbid 7%; other 4.9%. In addition to daily psychiatric consultations, two-thirds received individual counselling or group therapy; half received lab tests or scans; and 16.2% received ECT. Most took a psychiatric medicine. Half of those on antipsychotics were given only brands. Insurance paid in full for 28.8% of patients. Mean length of stay was 11.8 days and, in 12 months, 16.7 days (median 10.6). 22.2% were readmitted within 12 months. Patients with PHI stayed 36% longer than those paying out-of-pocket and had 2.5 times higher odds of readmission. Mean annual charge per patient was Int$ 4,262 (median Int$ 2,821). Insurers were charged 71% more than those paying out-of-pocket--driven by higher fees and longer stays. Chiromo delivers acute psychiatric care each year to approximately 450 people, to quality and human rights standards higher than its public counterpart, but at considerably higher cost. With more efficient delivery and wider insurance coverage, Chiromo might expand from its occupancy of 56.6% to reach a larger population in need.

Beyond Value-at-Risk: GlueVaR Distortion Risk Measures

We propose a new family of risk measures, called GlueVaR, within the class of distortion risk measures. Analytical closed-form expressions are shown for the most frequently used distribution functions in financial and insurance applications. The relationship between GlueVaR, value-at-risk, and tail value-at-risk is explained. Tail subadditivity is investigated and it is shown that some GlueVaR risk measures satisfy this property. An interpretation in terms of risk attitudes is provided and a discussion is given on the applicability in nonfinancial problems such as health, safety, environmental, or catastrophic risk management.

A one year pay-as-you-speed trial with economic incentives for not speeding

OBJECTIVE

The objective was to identify whether it was possible to change driver behavior by economic incentives and thereby reduce crash risk. Furthermore, the objective was to evaluate the participants' attitudes toward the pay-as-you-speed (PAYS) concept.

METHODS

A one-year PAYS trial with economic incentives for keeping speed limits using intelligent speed assistance (ISA) was conducted in Sweden during 2011-2012. The full incentive was a 30 percent discount off the insurance premium. The participants were private insurance customers and were randomized into a test group (initial n = 152, final n = 128) and a control group (initial n = 98, final n = 68). When driving, the drivers in the test group were informed and warned visually when the speed limit was exceeded. They could also follow their driving results on a personal website. The control group was not given any feedback at all. To reflect the impact of the PAYS concept the proportion of distance driven above the speed limit was compared between the 2 groups.

RESULTS

The introduction of a PAYS concept shows that the test group significantly reduced the proportion of distance driven above the speed limit. The proportion of driving at a speed exceeding 5 km/h over the speed limit was 6 percent for the test group and 14 percent for the control group. It also showed that the effect was higher the higher the violation of speed. The result remained constant over time.

CONCLUSIONS

It was shown that a PAYS concept is an effective way to reduce speed violations. Hence, it has the possibility to reduce crash severity and thereby to save lives. This could be an important step toward a safer road transport system. The majority of the participants were in favor of the concept, which indicates the potential of a new insurance product in the future.

Federal Housing Administration (FHA): Section 232 Healthcare Facility Insurance Program--Strengthening Accountability and Regulatory Revisions Update Final Rule Amendment--revision of date of applicability. Final rule amendment

On September 7, 2012, HUD published a final rule that revised the regulations governing the insurance of healthcare facilities under section 232 of the National Housing Act (Section 232). HUD's Section 232 program insures mortgage loans to facilitate the construction, substantial rehabilitation, purchase, and refinancing of nursing homes, intermediate care facilities, board and care homes, and assisted-living facilities. The amendments made by the September 7, 2012, final rule updated the Section 232 regulations to reflect current policy and practices, improve accountability and strengthen risk management in the program. The final rule provided an applicability date of April 9, 2013, for certain of the updated requirements. This final rule amendment changes the applicability date to July 12, 2013, for the purpose of allowing more time to transition to the new requirements.