Please note: The algorithm descriptions in English have been automatically translated. Errors may have been introduced in this process. For the original descriptions, go to the Dutch version of the Algorithm Register.

Risk equalisation

Due to the underwriting obligation, a health insurer may incur higher healthcare costs if it has a proportionately higher number of insured who need a lot of care. To ensure a level playing field between health insurers, risk equalisation exists. By means of risk equalisation, insurers with higher healthcare costs are financially compensated for this.

Last change on 24th of October 2024, at 14:11 (CET) | Publication Standard 1.0
Publication category
Other algorithms
Impact assessment
DPIA
Status
In use

General information

Theme

Health and Healthcare

Begin date

2006-01

Contact information

DienstpostbusFGR@minvws.nl

Link to publication website

https://www.zorginstituutnederland.nl/financiering/informatie-voor-zorginstanties-verzekeraars-en-zorgkantoren/risicoverevening-zvw/zvw-2024

Responsible use

Goal and impact

A health insurer must accept any person liable to pay insurance who wishes to take out health insurance with it. This is stipulated in the Health Insurance Act. That law also stipulates that the premium charged by the health insurer for such health insurance may not be tailored to the health risk or other characteristics of the insured. Without further measures, the consequence of the underwriting obligation and the prohibition of premium differentiation is that health insurers with a relatively large number of unhealthy policyholders in their health insurance portfolio are at a disadvantage compared to health insurers with a relatively healthy population, because, given their population, they are forced to charge a higher premium than their competitor with a healthier population. This inequality, created by differences in the risk profile of the insured portfolio, undermines the level playing field on which competition between health insurers should take place. Based on the risk equalisation model, health insurers estimate the risks of the insured on the basis of characteristics related to the health status of the insured as best as possible and are compensated accordingly.

Considerations

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Human intervention

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Risk management

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Legal basis

Article 32 Health Insurance Act

Links to legal bases

Artikel 32 Zorgverzekeringswet: https://wetten.overheid.nl/BWBR0018450/2018-01-01/#Hoofdstuk4_Paragraaf4.2_Artikel32

Impact assessment

Data Protection Impact Assessment (DPIA)

Operations

Data

Official Gazette 2024, 256 | Overheid.nl > Official notices (officielebekendmakingen.nl)

Technical design

Official Gazette 2024, 256 | Overheid.nl > Official notices (officielebekendmakingen.nl)

External provider

Internally developed

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