Véra Zabrodina awarded with the Young Swiss Economist prize at this year’s Swiss Society of Economics and Statistics for her paper «Timing Moral Hazard under Deductibles in Health Insurance»
![Véra Zabrodina](/fileadmin/_processed_/e/5/csm_230413_award_ihea_vera_zabrodina_9025ac0dba.jpg?1688460130)
The Faculty of Business and Economics congratulates!
Timing Moral Hazard under Deductibles in Health Insurance
This paper develops a new approach to identifying timing moral hazard in health insurance contracts when deductible choice is endogenous. I set up a dynamic model of healthcare consumption where individuals exceed a high deductible after a large health shock. I show that individuals either strategically prepone care from the year after the shock and keep a high deductible, or do not retime and switch to a low deductible the year after. The identification of timing moral hazard exploits the randomness of shock timing within a calendar year. Empirical results show quanti- tatively large timing moral hazard responses, which decrease with the time left to the deductible reset. The insured do re-optimize on-the-go to minimize out-of-pocket costs, but face substantial frictions in retiming, which differ across types of care. These patterns bear implications for cost sharing and insurance policy.