Policymakers subsidizing health insurance often face uncertainty about future market prices. We study the implications of one policy response: linking subsidies to prices, to target a given post-subsidy premium. We show that these price-linked subsidies weaken competition, raising prices for the government and/or consumers. However, price-linking also ties subsidies to health care cost shocks, which may be desirable. Evaluating this tradeoffs empirically using a model estimated with Massachusetts insurance exchange data, we find that price-linking increases prices 1-6%, and much more in less competitive markets. For cost uncertainty reasonable in a mature market, these losses outweigh the benefits of price-linking.

中文翻译：

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健康保险的价格挂钩补贴和不完全竞争

补贴医疗保险的政策制定者往往面临未来市场价格的不确定性。我们研究了一项政策回应的影响：将补贴与价格联系起来，以针对给定的补贴后溢价。我们表明，这些与价格挂钩的补贴削弱了竞争，提高了政府和/或消费者的价格。然而，价格挂钩也将补贴与医疗保健成本冲击联系起来，这可能是可取的。使用根据马萨诸塞州保险交易所数据估计的模型对这种权衡进行经验评估，我们发现价格挂钩将价格提高了 1-6%，在竞争较弱的市场中提高了 1-6%。对于成熟市场中合理的成本不确定性，这些损失超过了价格挂钩的好处。