Modeling Effects of Enrollee Choice

By Geof Hileman · Society of Actuaries · 2021

A January 2021 Society of Actuaries research report, sponsored by the Health Care Cost Trends Committee, on how consumer choice affects insurers in health insurance marketplaces. It uses health care encounter data to simulate the choices faced by health insurance shoppers under a variety of conditions, and measures the simulated effect of increased consumer choice and consumer information on medical loss ratios and, as a consequence, insurer profitability.

On the syllabus

Exam GH-101 — Outcomes 3c; the whole report.

Executive Summary

Shoppers in marketplaces choose from a range of plans and are given tools to estimate out-of-pocket costs under various plans; both improve the shopping experience but increase the risk that insured individuals will select against the insurers.

1 Premise and Motivation

2 Model Mechanics

2.1 Data Source
2.2 Simulation Model
2.3 Output Measures

3 Results

3.1 Two-Plan Market
3.2 Eight-Plan Market
3.3 Eight-Plan Market: Diverse Plans
3.4 Subsidized Market
3.5 Subsidized Market

4 Acknowledgments

Sources

Modeling Effects of Enrollee Choice (Society of Actuaries, January 2021) — the document: title, author, sponsor, contents page (section titles as printed, including the repeated "Subsidized Market" of 3.4 and 3.5) and the executive summary (14 pages, sha256 65bea6ed728ba3cbe62d283d35c9674a239f12a02b5b40db1d9a80a4076a15fc); the text under the numbered sections was not summarised
GH 101 Syllabus, Nov 2026/Mar 2027/Jul 2027 (SOA) — the citation and the learning outcome