Table 2 Potential positive effects of risk equalization and risk sharing (via the reduction of selection)
1 | Improvements of the quality of care due to better efforts by insurers and providers to acquire the best reputation for treating patients with specific diseases who previously were unprofitable |
2 | The playing field for providers is more leveled |
3 | Insurance products are more in line with consumer preferences |
4 | Better customer service for high-risk consumers |
5 | More investments by insurers in cost containment since the potential returns on risk selection decrease |
6 | A reduction of selection-driven product proliferation which increases transparency on the health insurance market and thereby enhances a value-for-money consumer choice and competition on efficiency |
7 | Fewer resources spent on selection activities |
8 | Consumers increasingly choose the ‘right’ insurance product as premium differences between high- and low-value products are less distorted by differences in risk composition across insurance products |
9 | More stability in the insurance market (resulting in a reduction of the social costs of the absence of a market equilibrium in terms of excessive exit and re-entry of insurers and insurance products) |
10 | Intended income redistribution from low-risk to high-risk consumers is more fully achieved |
11 | Increased affordability of high-value insurance products (which improves access to high-quality care) |
12 | The playing field for insurers is more leveled |
13 | A lower chance of bankruptcy of (efficient) insurers due to adverse selection |
14 | Lower loading fees due to a reduction of the risk of adverse selection |