Organizing the Health Insurance Market教程.pdfVIP

Organizing the Health Insurance Market Author(s): Peter Diamond Reviewed work(s): Source: Econometrica, Vol. 60, No. 6 (Nov., 1992), pp. 1233-1254 Published by: The Econometric Society Stable URL: /stable/2951520 . Accessed: 31/03/2012 03:10 Your use of the JSTOR archive indicates your acceptance of the Terms Conditions of Use, available at . /page/info/about/policies/terms.jsp JSTOR is a not-for-profit service that helps scholars, researchers, and students discover, use, and build upon a wide range of content in a trusted digital archive. We use information technology and tools to increase productivity and facilitate new forms of scholarship. For more information about JSTOR, please contact support@. The Econometric Society is collaborating with JSTOR to digitize, preserve and extend access to Econometrica. Econometrica, Vol. 60, No. 6 (November, 1992), 1233-1254 ORGANIZING THE HEALTH INSURANCE MARKET BY PETER DIAMOND1 This paper presents a new approach to organizing universal health insurance. First the government divides the entire population into many large groups. Then, the government creates a Federal Health Insurance System (HealthFed), modeled on the Federal Reserve System, to fill the role now played by the benefits office of a large firm. The HealthFed would create a short menu of alternatives, solicit bids for insuring the entire group, and price alternatives. There would be redistribution between groups and pricing of alterna- tives to reflect optimal social insurance principles. There would be no connection between health insurance and employment. KEYWORDS:Health insurance, medical care, social insurance, group insurance. IT MAY SEEM ODD that this Presidential Address is my first publication in health economics.