Department of Economic Studies of CADE publishes a study on the market of private health insurance

On 28 October 2021, the Department of Economic Studies of CADE (DEE/CADE) published a working paper on the market of private health insurance, titled “Ensaios sobre o mercado de saúde suplementar”. It brings together three studies carried out by the DEE to understand the sector’s competition challenges.

The first one discusses the relation amongst the concentration indexes, geographic relevant markets and prices of the private health insurance sector. It serves as a basis for calculating the indicators associated with the degree of competition in Brazilian municipalities and in groups of municipalities defined by different methodologies, such as the health insurance geographic relevant markets.

The second essay estimates the hedonic pricing – i.e. implicit prices related to different attributes – of private health insurance. This section presents two sets of price-related data: the prices of monthly fees registered within the Brazilian Agency for Private Health Insurance (ANS); and the prices charged by two health insurance companies in the city of Vitória, state of Espírito Santo.

Lastly, the third essay presents the rules in force or under study related to the health insurance market that may affect competition. Additionally, it makes regulatory suggestions to regulators take into account when reviewing these rules. The suggestions comprise a publication of the ANS related to reviewing the impact of changes on the list of mandatory health procedures, and reviewing the responsibility rule for emergency services in outpatient insurance after 12 hours of hospitalization.

According to the DEE, discussing competitive impacts and suggesting changes for the consideration of regulators is part of CADE’s competition advocacy role. Since the private health insurance sector is a regulated market, it is necessary to assess how the market regulation affects competition. Thus, it is important to evaluate competition effects on the analysis of the regulatory impact.

Access the working paper (Portuguese version only).