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Title: Unravelling risk selection in Spanish general government employee mutual funds: evidence from cancer hospitalizations in the public health network
Authors: Pinilla Domínguez, Jaime 
González Lopez-Valcarcel, Beatriz 
Bernal-Delgado, Enrique
UNESCO Clasification: 531207 Sanidad
Keywords: Exact matching
Mutual Funds model
Private health insurance companies
Risk selection
Issue Date: 2024
Project: Encaje Público-Privado en Sanidad: Calidad, Sostenibilidady Cambios Del Modelo Español 
Journal: European Journal of Health Economics 
Abstract: Government employees in Spain are covered by public Mutual Funds that purchase a uniform basket of benefits, equal to the ones served to the general population, from private companies. Companies apply as private bidders for a fixed per capita premium hardly adjusted by age. Our hypothesis is that this premium does not cover risks, and companies have incentives for risk selection, which are more visible in high-cost patients. We focus on a particularly costly disease, cancer, whose prevalence is similar among government employees and the general population. We compare hospitalisations in the public hospitals of the government employees that have chosen public provision and the general population. We analysed a database of hospital discharges in the Valencian Community from 2010 to 2015 (3 million episodes). Using exact matching and logistic models, we find significant risk selection; thus, in hospitalised government employees, the likelihood for a solid metastatic carcinoma and non-metastatic cancer to appear in the registry is 31% higher than in the general population. Lymphoma shows the highest odds ratio of 2.64. We found quantitatively important effects. This research provides indirect evidence of risk selection within Spanish Mutual Funds for government employees, prompting action to reduce incentives for such a practice. More research is needed to figure out if what we have observed with cancer patients occurs in other conditions.
ISSN: 1618-7598
DOI: 10.1007/s10198-024-01671-5
Source: The European Journal of Health Economics : HEPAC : Health Economics in Prevention and Care. 2024 Feb
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