The Role of Independent Agents in the Success of Health Insurance Market Reforms

The impact of reforms on the health insurance markers cannot be understood without more information about the role played by insurance agents and a closer analysis of their contribution. An in-depth, qualitative study of insurance-marker reforms in seven illustrative states forms the basis for this report on how agents help to shape the efficiency and fairness of insurance markers. Different types of agents relate to insurers in their own ways and are compensated differently This study shows agents to be almost uniformly enthusiastic about guaranteed-issue requirements and other components of market reforms. Although insurers devise strategies for manipulating agents in order to avoid undesirable business, these opportunities are limited and do nor appear to be seriously undermining the effectiveness of marker reforms. Despite the layer of cost that agents add to the system, they play an important role in making marker reforms work, and they fill essential information and service functions for which many purchasers have no ready substitute.

Author(s): Mark A. Hall

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Volume 78, Issue 1 (pages 23–45)
DOI: 10.1111/1468-0009.00160
Published in 2000