Essays on Private Health Insurance in Public Programs

Over 100 million people in the US now have public health insurance that is administered by a private company. This dissertation consists of three essays that analyze various outcomes in private health insurance markets inside of US public programs. Chapter 1 of this dissertation outlines the role of private insurers in public health insurance programs in the US. It also summarizes the key lessons learned from the remaining chapters of the dissertation. Chapter 2 of this dissertation examines the effect of insurer entry in the health insurance marketplaces, started by the Patient Protection and Affordable Care Act, on total costs for the insured. In the first year of the marketplaces, each insurer decreased patient costs by 5 percent or more. In the second year of the marketplaces, however, additional insurers had no average effects on patient costs. Chapter 3 examines the implications of private versus public administration of Medicare for elderly cancer patients. Having privately, rather than publicly, administered insurance at the time of initial cancer diagnosis increased mortality for patients with brain cancer, lung cancer, or prostate cancer in a health service area with at least 500,000 people. Insurance choices also suggested a preference among cancer patients for the public Medicare plan. Finally, Chapter 4 examines the relationship between private Medicare plans and preventive care and how that relationship may be affected by modern risk adjustment policies that adjust insurer revenues according to patients' chronic medical conditions. Before modern risk adjustment, private Medicare plans increased patients' use of pneumonia and flu shots. However, the introduction of modern risk adjustment reduced patients' use of pneumonia shots and colorectal cancer screening.