Professor Emeritus, University of South Florida
Healthcare Main Page | Change & Risk Management Main Page
Summary by James R. Martin, Ph.D., CMA
Professor Emeritus, University of South Florida
Healthcare Main Page |
Change & Risk Management Main Page
According to public health experts, 70% of the population must be vaccinated to overcome a pandemic. However, although vaccines for COVID-19 are readily available and highly effective, the vaccination rate in many states is far below that level. For example, Georgia is one of the seven least vaccinated states with 34% of the population fully vaccinated. Promoting the vaccines with education campaigns has not been effective enough to overcome the vaccine-aversion of a large percentage of the population. Therefore, other options must be examined to promote the desired behavior without a vaccination mandate that would likely be challenged on civil liberties grounds.
Vaccine hesitancy is a textbook example of a negative consumption externality, i.e., where an individual's choices can harm or impose costs on others. Other examples include indoor smoking, drunk driving, and littering. One policy option to promote desired behavior is the insurance mechanism. Insurance companies use risk assessment and risk pricing to reduce risky behavior and to redistribute the premium and cost sharing burden from low-risk consumers to high risk consumers. Auto insurance premiums are higher for unsafe drivers. Smokers pay higher health insurance premiums than non-smokers. Homeowners in a wildfire area pay higher homeowners' insurance than owners in less fire prone areas. Using the same logic, health insurance premiums, deductibles and co-pays can be set higher for the unvaccinated.
Insurance companies have been covering coronavirus infections like other illnesses related to factors that are uncontrollable by the individuals who become infected. This needs to change for all but a few individuals who have severe allergies to vaccines. Using risk-based pricing to set health insurance premiums and co-pays will provide an incentive to get vaccinated, and provide a fairer insurance pricing system. Those who have self-selected a higher risk level will pay a higher price rather than shifting their medical costs to others. Risk-based pricing will avoid forcing those who are vaccinated to subsidize the medical cost of those who refuse vaccination.
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Some other ways to promote vaccines:
1. Develop public relations campaigns that emphasize the severity of vaccine-preventable diseases,
2. Develop effective responses to specific anti-vaccine concerns (e.g., fear of vaccinations, distrust of authority, conspiracy theories about vaccines, social pressure, lack of information),
3. Make entry to restaurants, malls, movie theaters, concerts etc. contingent on vaccination,
4. Use celebrities' and trusted leaders' endorsements of vaccines,
5. Market vaccines to children with Saturday morning TV ads, e.g., cartoon characters showing dumb ways to die,
6. Create shareable graphics for social media like, "I got vaccinated", "I got my kids vaccinated", and "I got my family vaccinated."
7. Develop good citizenship public act stickers like "I got the COVIT-19 Vaccine" similar to "I voted" stickers.
Related summaries:
Martin, J. R. 2020. Risk of spreading the coronavirus. Management And Accounting Web.
