Private insurance firms participating in Medicare can offer up to three principal plan types: coordinated care plans (CCPs), prescription drug plans (PDPs), and private fee for service (PFFS) plans. Firms can make entry and marketing decisions separately across plan types and geographic regions....

Prices set by fee-for-service Medicare have a direct effect on prices paid by private insurers throughout the health care system. While this link is widely recognized, there is disagreement about whether higher Medicare prices lead to lower or higher prices for private health insurance. We...