Health Care Management Papers

Document Type

Technical Report

Date of this Version

10-2000

Publication Source

The Journal of Business

Volume

73

Issue

4

Start Page

569

Last Page

595

DOI

10.1086/209655

Abstract

We analyze the relationship between insurance rate regulation, inflationary cost surges, and incentives for loss control using state-level data on workers’ compensation insurance for 24 states during 1984–90. Regulators often responded to rapid loss growth during this period by denying rate increases or approving increases that were less than initially requested by insurers. We test whether rate suppression increased loss growth by distorting incentives for loss control. Our regressions indicate a positive and statistically reliable relationship between loss growth and lagged measures of regulatory price constraints, suggesting that rate regulation increased the frequency and/or severity of employee injuries.

Comments

This article was published in a journal that has since ceased to be produced.

Share

COinS
 

Date Posted: 27 November 2017

This document has been peer reviewed.