Previously circulated as “Long-Term Health Insurance: Theory Meets Evidence.” We are grateful to the editor, Harald Uhlig, and two anonymous referees for detailed comments that significantly improved the paper. Siqi Li provided outstanding research assistance. We also thank Konstantin Beck, Paola Bertoli, Rudi Blankert, Friedrich Breyer, Florian Buchner, Keith Ericson, Colleen Carey, Mariacristina De Nardi, David Dillenberger, Stefan Felder, Sebastian Fleitas, Eric French, Leora Friedberg, Paul Grieco, Ben Handel, Glenn Harrison, Jim Heckmann, Kate Ho, Mathias Kifmann, Amanda Kowalski, Dirk Krueger, Ethan Lieber, Tony Lo Sasso, Claudio Lucarelli, Maria Polyakova, John Rust, Andreas Ryll, Holger Strulik, Nicholas Tilipman, JürgenWasem, Michael Whinston, JoachimWinter, Moto Yogo, Jin Zhou, and Peter Zweifel as well as seminar participants at Boston University, Columbia University, Indiana University, Georgia State University, Georgetown University, Johns Hopkins University, Lund University, Princeton University, University of Chicago, University of Pennsylvania, University of Maryland, University of Wisconsin-Madison, and conference participants at the American Society of Health Economists (2018), Annual Meeting of the Southern Economic Association (2018), Essen Health Conference (2019), Congress of the International Health Economics Association (iHEA 2019), GSE Forum in Microeconometrics (2019), Health Economics Working Group Meeting of the German Economic Association (Ausschuss für Gesundheitsökonomie, 2018), NBER Insurance Working Group Conference (2019), New York Area Health Economics Day (2019) and the North American Winter Meeting of the Econometric Society (2022) for very helpful comments and suggestions. We thank representatives of the German Association of Private Health Insurers and Frank Bowert for invaluable comments on how well our modeling of German LTHI reflects actuarial practices, and we thank Friedrich Breyer for connecting us with representatives from the PKV which provided us the claims data. We have no financial interests that would constitute any conflict of interests with this research. Generous funding by the German Federal Ministry of Education and Research (FKZ: 01EH1602A) is gratefully acknowledged. The views expressed herein are those of the authors and do not necessarily reflect the views of the National Bureau of Economic Research.
