Sources and Preparation of Data Used in HISIM2—CBO’s Health Insurance Simulation Model: Working Paper 2019-04
CBO developed a new version its health insurance simulation model, HISIM2, including using new sources of input data. This paper describes the new input data and the methods for adjusting and adding to those data to form the sample used in HISIM2.
By Jessica Banthin, Keren Hendel, Ben Hopkins, Geena Kim, Alexandra Minicozzi, Eamon Molloy, and Allison Percy (all of CBO)
CBO’s new health insurance simulation model, HISIM2, is a microsimulation model, meaning that it uses individual-level input data to simulate population behavior. Beginning with the spring 2019 baseline budget projections, CBO completely revamped the way it models consumer and employer behavior; the agency also updated to new sources of individual-level input data. This paper describes the input data and the procedures for adjusting and adding to those data to form the sample used by HISIM2. The new model has been designed to use the Current Population Survey as its main source of base data. CBO builds the units of its analysis, such as those that make joint decisions about health insurance, based on family relationships. The agency also edits and imputes variables that are important for modeling health insurance decisions to create the data for the base year, 2015. These variables include demographic characteristics, employment characteristics, income, health coverage options, health spending, employer characteristics, and insurance premiums. Then, CBO projects those characteristics into the future—incorporating additional data from 2016 to 2018, expectations about the economy, and the effects of existing policy—to create input data for each year of the agency’s budget projection period, 2019 to 2029.