The Role of the Individual Health Insurance Market and Prospects for Change

Published in: Health Affairs, v. 23, no. 6, Nov./Dec. 2004, p. 79-90

Posted on RAND.org on December 31, 2003

by Melinda Beeuwkes Buntin, M. Susan Marquis, Jill M. Yegian

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The individual market is the only source of health insurance for the more than 20 percent of Americans not eligible for group or public health insurance, yet participation rates are low and shrinking. This paper examines this market's structural features and assesses the likelihood that it will play an expanded role in the future. The authors describe how pressures such as cost growth, new technologies, and changes in the nature of the workplace are shaping the individual market. They conclude that the future of the market will depend largely on whether there are policy interventions that balance the problems of affordability, risk sharing, and adverse selection.

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