• AEA in the news
  • December 15, 2015

Obamacare Sign-Ups Could Get A Bump As Higher Penalties Kick In


NPR's Morning Edition covered a recent American Economic Review article in a story about rising penalties for failing to purchase insurance under the Affordable Care Act. In Adverse Selection and an Individual Mandate: When Theory Meets Practice, the authors study the Massachusetts health reform experience in the mid-2000s. They find that the introduction of a penalty successfully combatted adverse selection in the state's health insurance markets, and that a higher penalty would have been even better.