August 21, 2010
David Auerbach, Janet Holtzblatt, Paul Jacobs, Alexandra Minicozzi, Pamela Moomau, and Chapin White
This paper provides an analytical framework for evaluating the effects of individual health insurance mandates on coverage. That framework draws from the literature in three disciplines—health economics, tax compliance, and behavioral economics—to identify the factors that affect people’s responses to health insurance mandates. The health economics literature examines how people value health insurance and how changes in its costs affect coverage. The tax compliance literature indicates that the probability of detection and people’s attitudes toward risk affect perceptions of those costs. The salience of the mandate and social norms—factors identified in the literature of behavioral economics—are also important factors in decisions about coverage.