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The Welfare Impact of Reducing Choice in Medicare Part D: A Comparison of Two Regulation Strategies / Claudio Lucarelli, Jeffrey Prince, Kosali Simon.
- Format:
- Book
- Author/Creator:
- Lucarelli, Claudio.
- Series:
- Working Paper Series (National Bureau of Economic Research) no. w14296.
- NBER working paper series no. w14296
- Language:
- English
- Physical Description:
- 1 online resource: illustrations (black and white);
- Place of Publication:
- Cambridge, Mass. National Bureau of Economic Research 2008.
- Summary:
- Motivated by widely publicized concerns that there are "too many" plans, we structurally estimate (and validate) an equilibrium model of the Medicare Part D market to study the welfare impacts of two feasible, similar-sized approaches for reducing choice. One reduces the maximum number of firm offerings regionally; the other removes plans providing donut hole coverage - consumers' most valued dimension. We find welfare losses are far smaller when coupled with elimination of a dimension of differentiation, as in the latter approach. We illustrate our findings' relevance under current health care reforms, and consider the merits of instead imposing ex ante competition for entry.
- Notes:
- Print version record
- September 2008.
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