Author: Dafny Leemore Hendel Igal Wilson Nathan
Publisher: American Economic Association
ISSN: 0002-8282
Source: The American Economic Review, Vol.105, Iss.5, 2015-05, pp. : 110-114
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Abstract
The Affordable Care Act has engendered significant changes in the design of health insurance products. We examine the “narrowness” of hospital networks affiliated with plans offered in the first year of the marketplaces. Using data from Texas, we find limited evidence of a tight link between pricing and a simple measure of network breadth, or a more complex measure of network value derived from a logit model of hospital choice. The state's largest insurer priced its narrow networks at a fairly constant discount relative to its broad networks, notwithstanding significant variation in its broad-narrow gap across geographic markets in Texas.
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