Description: A new health insurance pricing model takes external market prices into account, as well as regulatory rate restrictions and other traditional pricing factors. Rather than being assumed at the outset, lapse rates emerge from the model, along with assessment spiral & loss ratio projections. Under the model optimal pricing strategy depends on whether the class being rated has a healthier than average mix of risks.

Description: This article discusses the advantages, logistical concerns, and pricing formulas of implementing a TNHP, in which members pay less for treatment from providers who meet higher quality and cost-effectiveness standards.