Equalizing the Cost of Health Insurance

The Dutch government compensates health insurance companies when insuring individuals who are estimated to have high health care costs. This is necessary to avoid insurers not offering services to certain groups or not providing them with a high quality of service. It is, however, unknown to what extent the differences in health care expenses by different groups of people are truly due to a poorer or better health status. We explore several statistical approaches that facilitate explaining the cause of these differences.