The Role of Agents and Brokers in the Market for Health Insurance
December 2013
Working Paper Number:
CES-13-58
Abstract
Health insurance markets in the United States are characterized by imperfect information, complex products, and substantial search frictions. Insurance agents and brokers play a significant role in helping employers navigate these problems. However, little is known about the relation between the structure of the agent/broker market and access and affordability of insurance. This paper aims to fill this gap by investigating the influence of agents/brokers on health insurance decisions of small firms, which are particularly vulnerable to problems of financing health insurance. Using a unique membership database from the National Association of Health Underwriters together with a nationally representative survey of employers, we find that small firms in more competitive agent/broker markets are more likely to offer health insurance and at lower premiums. Moreover, premiums are less dispersed in more competitive agent/broker markets.
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:
market,
agency,
finance,
oligopoly,
insurance,
consumer,
buyer,
coverage,
premium,
medicare,
healthcare,
insured,
health insurance,
insurer,
trader
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identified to contain references to specific institutions, datasets, and other organizations.
:
National Science Foundation,
Chicago Census Research Data Center,
Medical Expenditure Panel Survey,
University of Minnesota,
North American Industry Classification System,
American Community Survey,
Herfindahl Hirschman Index,
Core Based Statistical Area,
International Trade Research Report
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