Table 1.

Glossary

Cross-subsidies	We primarily focus on cross-subsidies from the low-risks to the high-risks. That is, we primarily focus on ‘risk-solidarity’ (and not on ‘income-solidarity’)
Equalization fund	The fund, managed by the regulator, out of which equalization payments are made. This fund can be filled with contributions by, e.g., consumers, insurers, government, and/or employers
Equalization payment	The payment per insured that an insurer receives from (if positive) or has to pay to (if negative) the equalization fund. In many countries the insurer may charge the insured an out-of-pocket premium
Health insurer	Risk-bearing entity that offers health plans, sometimes denoted as sickness fund
Health insurance agent	An agent or intermediary who advises consumers, and/or who sells health plans on behalf of the insurer; the agent may be authorized by the insurer to perform administrative functions. The insurer is the risk-bearing entity
Health plan	Health insurance product. All consumers who have the same ‘health plan’ have an identical contract with the insurer concerning benefits coverage, cost-sharing, quality, services, etc. An insurer may offer different health plans
Regulator	The entity that regulates and supervises the health insurance market, e.g., government, an entity empowered by government, or (a group of) employers (sometimes named sponsor, Health Alliance, Health Insurance Purchasing Cooperative, Connector, Health Insurance Exchange)
Residual expenses	The actual expenses minus the risk-adjusted predicted expenses
Risk adjuster	See 'risk adjustment'
Risk adjustment	A technique used to calculate risk-adjusted predicted health expenses based on the individual’s risk characteristics (‘risk adjusters’)
Risk equalization	A system of risk-adjusted equalization payments to and from insurers aimed at achieving the cross-subsidies from the low-risks to the high-risks as intended by the regulator
Risk selection	Actions (other than risk rating per health plan) by consumers and insurers with the goal and/or the effect that the cross-subsidies as intended by the regulator are not fully achieved