Background: In Switzerland, age is the predominant driver of solidarity transfers in risk adjustment (RA). Concerns have been voiced regarding growing imbalances in cost sharing between young and old insured due to demographic changes (larger fraction of elderly 65 years and rise in average...

Background: In Switzerland, age is the predominant driver of solidarity transfers in risk adjustment (RA). Concerns have been voiced regarding growing imbalances in cost sharing between young and old insured due to demographic changes (larger fraction of elderly 65 years and rise in average...

The main objective of risk adjustment in systems of regulated competition on health insurance markets is the removal of incentives for undesirable risk selection. We introduce a simple conceptual framework to clarify how the definition of acceptable costs and the distinction between legitimate...