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International Portability of Health-Cost Cover: Mobility, Insurance, and Redistribution

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  • Martin Werding
  • Stuart McLennan

Abstract

Public health insurance and other arrangements covering health-costs effectively provide insurance against changes in health status. These arrangements engage in burden-smoothing over the life cycle and entail various elements of redistribution. Lack of portability regarding this type of cover may impede international mobility and create financial losses or windfall gains on various sides, which can lead to risk segmentation across national health systems. Existing portability rules do not fully address these problems. In this paper, we try to clarify the implications of mobility for typical systems covering health costs and the requirements which have to be met to ensure full portability. When individuals are internationally mobile, compensating payments are needed based on changes in expected net costs in both of the health funds involved. Illustrative simulations show that this approach may be operative under real-world conditions.

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Bibliographic Info

Paper provided by CESifo Group Munich in its series CESifo Working Paper Series with number 3952.

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Date of creation: 2012
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Handle: RePEc:ces:ceswps:_3952

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Related research

Keywords: social insurance; health costs; migration; international portability; fiscal externalities; risk segmentation;

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References

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  1. Herring, Bradley & Pauly, Mark V., 2006. "Incentive-compatible guaranteed renewable health insurance premiums," Journal of Health Economics, Elsevier, vol. 25(3), pages 395-417, May.
  2. Robert Fenge & Silke Uebelmesser & Martin Werding, 2006. "On the Optimal Timing of Implicit Social Security Taxes Over the Life Cycle," FinanzArchiv: Public Finance Analysis, Mohr Siebeck, Tübingen, vol. 62(1), pages 68-107, March.
  3. Werding, Martin & McLennan, Stuart, 2011. "International portability of health-cost coverage : concepts and experience," Social Protection Discussion Papers 63929, The World Bank.
  4. Hans-Werner Sinn, 2004. "The New Systems Competition," Perspektiven der Wirtschaftspolitik, Verein für Socialpolitik, vol. 5(1), pages 23-38, 02.
  5. Munz, Sonja & Werding, Martin, 2005. "Public pensions and international migration: some clarifications and illustrative results," Journal of Pension Economics and Finance, Cambridge University Press, vol. 4(02), pages 181-207, July.
  6. Volker Meier, 2003. "Efficient Transfer of Aging Provisions in Private Health Insurance," CESifo Working Paper Series 862, CESifo Group Munich.
  7. Li, Minqiang, 2010. "Asset Pricing - A Brief Review," MPRA Paper 22379, University Library of Munich, Germany.
  8. Florian Baumann & Volker Meier & Martin Werding, 2004. "Transferable Ageing Provisions in Individual Health Insurance Contracts," CESifo Working Paper Series 1116, CESifo Group Munich.
  9. Holzmann, Robert & Koettl, Johannes, 2011. "Portability of pension, health, and other social benefits : facts, concepts, issues," Social Protection Discussion Papers 62725, The World Bank.
  10. Wei Sun & Anthony Webb & Natalia Zhivan, 2009. "Does Staying Healthy Reduce Your Lifetime Health Care Costs?," Issues in Brief ib2010-8, Center for Retirement Research, revised May 2009.
  11. Daniel Leigh & David Hauner & Michael Skaarup, 2007. "Ensuring Fiscal Sustainability in G-7 Countries," IMF Working Papers 07/187, International Monetary Fund.
  12. Wido Geis & Silke Uebelmesser & Martin Werding, 2013. "How do Migrants Choose Their Destination Country? An Analysis of Institutional Determinants," Review of International Economics, Wiley Blackwell, vol. 21(5), pages 825-840, November.
  13. Jonathan Gruber & Brigitte C. Madrian, 2002. "Health Insurance, Labor Supply, and Job Mobility: A Critical Review of the Literature," NBER Working Papers 8817, National Bureau of Economic Research, Inc.
  14. Holzmann, Robert & Koettl, Johannes & Chernetsky, Taras, 2005. "Portability regimes of pension and health care benefits for international migrants: an analysis of issues and good practices," Social Protection Discussion Papers 32750, The World Bank.
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Cited by:
  1. Taha, N. & Messkoub, M. & Siegmann, K.A., 2013. "How portable is social security for migrant workers?," ISS Working Papers - General Series 573, International Institute of Social Studies of Erasmus University Rotterdam (ISS), The Hague.

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