Risk adjustment and risk selection on the sickness fund insurance market in five European countries

Wynand P.M.M. Van De Ven, Konstantin Beck, Florian Buchner, Dov Chernichovsky, Lucien Gardiol, Alberto Holly, Leida M. Lamers, Erik Schokkaert, Amir Shmueli, Stephan Spycher, Carine Van De Voorde, René C.J.A. Van Vliet, Jürgen Wasem, Irith Zmora

Research output: Contribution to journalArticlepeer-review

99 Scopus citations


From the mid-1990s citizens in Belgium, Germany, Israel, the Netherlands and Switzerland have a guaranteed periodic choice among risk-bearing sickness funds, who are responsible for purchasing their care or providing them with medical care. The rationale of this arrangement is to stimulate the sickness funds to improve efficiency in health care production and to respond to consumers' preferences. To achieve solidarity, all five countries have implemented a system of risk-adjusted premium subsidies (or risk equalization across risk groups), along with strict regulation of the consumers' direct premium contribution to their sickness fund. In this article we present a conceptual framework for understanding risk adjustment and comparing the systems in the five countries. We conclude that in the case of imperfect risk adjustment - as is the case in all five countries in the year 2001 - the sickness funds have financial incentives for risk selection, which may threaten solidarity, efficiency, quality of care and consumer satisfaction. We expect that without substantial improvements in the risk adjustment formulae, risk selection will increase in all five countries. The issue is particularly serious in Germany and Switzerland. We strongly recommend therefore that policy makers in the five countries give top priority to the improvement of the system of risk adjustment. That would enhance solidarity, cost-control, efficiency and client satisfaction in a system of competing, risk-bearing sickness funds.

Original languageEnglish
Pages (from-to)75-98
Number of pages24
JournalHealth Policy
Issue number1
StatePublished - 1 Jul 2003


  • International comparison
  • Regulated competition
  • Risk adjustment
  • Risk selection
  • Sickness fund insurance market

ASJC Scopus subject areas

  • Health Policy


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