Consumer Heterogeneity,Adverse Selection And Business Performance Of Commercial Health Insurance Companies

In recent years,commercial health insurance in China has developed rapidly,premium income maintains continuous growth.Under the double favorable conditions of government policy support and increasing market demand,the health insurance market potential is very huge.However,at present,China's commercial health insurance business is experiencing difficulties in production and business operation.Adverse selection is an important cause of loss of insurance companies,and the business performance of commercial health insurance companies is poor.This article will use adverse selection as the core perspective,researching the relationship between consumer heterogeneity,adverse selection and the business performance of commercial health insurance companies,and propose ways to prevent and weaken adverse selection,so as to achieve the purpose of improving the operating performance of insurance companies.Chapter 1: Introduction.Chapter 1 summarizes the background and research significance of the topic as a whole,and clarifies the main content of the study and the main methods of research,and draws the technical route of the study.Taking into account the need for empirical research,Chapter 1 introduces the database used in this article,China Health and Retirement Longitudinal Study.Finally,it points out the innovation and limitations of the literature research and puts forward the future research direction.Chapter 2: Literature review.This chapter reviews the main literature related to this study: the influence of consumer heterogeneity on the purchase intention of commercial health insurance and the effect of heterogeneity on the empirical results of adverse selection;summarized several methods of empirical tests for adverse selection,reviewed the research status at home and abroad and some representative empirical findings.Chapter 2 reviews the evaluation methods and empirical studies of the insurance company's operating performance;discusses the theoretical linkages of consumer heterogeneity,adverse selection and business performance.Chapter 3: This chapter is divided into two parts,the overview of China's commercial health insurance market and the current status of China's commercial health insurance companies.Part one first outlines the status of foreign commercial health insurance in the medical insurance market,and the efforts of countries to support the development of commercial health insurance.Then Chapter 3 outlines the overall situation of the development of China's commercial health insurance,comprehensively combing the business model,development space and the difficulties faced by the development of health insurance.Finally,this chapter points out the opportunity for the development of China's commercial health insurance and the future development trend.Part two introduces the product categories covered by China's current health insurance market,including medical insurance,disease insurance,disability income insurance,and nursing care insurance,and medical accident insurance that is planned to be incorporated into health insurance.This chapter also summarizes the business structure of China's commercial health insurance company,including business health insurance,commission business of government and health management.And then we discuss several modes of commercial health insurance companies participating in social health insurance.At last,Chapter 4 points out the general loss situation of China's commercial health insurance companies and sorts out the causes of losses.We point out that adverse selection is one of the important reasons leading to the loss of commercial health insurance companies.Chapter 4;Consumer heterogeneity and adverse selection.The fourth chapter combs the relationship between consumer heterogeneity and adverse selection theoretically,emphasizing the neglect of the influence of consumer heterogeneity lead to the empirical test of adverse selection no longer objective.In this paper we discuss risk heterogeneity is the premise foundation for adverse selection,and further discuss the influence of risk preference heterogeneity and multidimensional information heterogeneity on the purchase behavior of health insurance and the impact on the proof of adverse selection.Chapter 5: The empirical test of the adverse selection of health insurance.Considering the business of commercial health insurance companies including health insurance and social medical insurance,from the perspective of insurance companies,it is necessary to investigate the adverse selection of the two markets at the same time.This section examines the correlation between consumer subjective health assessment and insurance coverage,and the correlation between insurance coverage and medical service utilization.It demonstrates from two perspectives that adverse selection exists in both the commercial health insurance market and the social health insurance market.It shows that reverse selection is ubiquitous.At the same time,the results show that people with insurance have more usage of medical services than those without insurance.This section further analyzes the influencing factors that affect purchase intentions of commercial health insurance and social health insurance,and we find that age,education level,wealth level,and insurance awareness significantly affect the purchase intention of commercial health insurance and social health insurance.Chapter 6: The performance evaluation of the commercial health insurance company.Under the framework of comprehensive risk management,we construct an evaluation system for the performance of commercial health insurance companies,and use principal component analysis to calculate the performance scores of insurance companies.And further discussed the impact of adverse selection on the performance of commercial health insurance companies,and pointed out that the financial indicators such as loss ratio and underwriting profit margin are important evaluation indicators of the performance of commercial health insurance companies.The adverse selection indirectly affects the performance of insurance companies from affecting these two indexes.At the end of this chapter,we provide an empirical test of the effect of loss ratio on performance.We propose to take the performance score as an explanatory variable and comprehensively consider the loss ratio and other influencing factors for regression analysis.Due to the limitation of the number of samples,analysis is difficult to achieve,we can only explain theoretically and provides research evidence of other scholars.Chapter 7: The methods of preventing and reducing the influencing of adverse selection.This chapter reviews the methods of preventing and reducing the influencing of adverse selection,including the mining of consumer information,the use of signal theory,and the realization of managed medical models.And then,in this chapter we propose a method of expanding insurance coverage of low-risk people to reduce the influencing of adverse selection,and conduct a mathematical proof.Finally,it deduces the pricing combination insurance after introducing low-risk populations.Chapter 8: Concludes.Based on the contents of the previous eight chapters,we summarize the effects of consumer heterogeneity on insurance purchase intention,introduce the role of consumer heterogeneity in adverse selection empirical tests and find adverse selection are common in the health insurance market.The paper discusses the influence of adverse selection on the performance of commercial health insurance companies and empirical thinking,and proposes ways to prevent and weaken adverse selection.At last we provided the empirical thinking of the influence of adverse selection on the performance of commercial health insurance companies and propose ways to prevent and weaken adverse selection.At last,based on the conclusions of this study,we suggested that standardize the behavior of commercial health insurance market players to improve commercial health insurance companies' s profitability.The innovations of this paper include the following points: standardizes the variables in the empirical test of adverse health insurance;proposes to use "whether to be hospitalized many times" and "whether to see the outpatient or not" to distinguish the post-event risk between commercial health insurance and social health insurance;discusses the impact of adverse selection on the business performance of commercial health insurance companies and evaluates the business performance of commercial health insurance companies;proposes the idea of indirectly proving that the adverse selection influences the performance of insurance companies;provides a new way to reduce the influencing of adverse selection an expanding low-risk people to buy health insurance,and prove the way from mathematical way.