Scott E. Harrington

Scott E. Harrington
  • Alan B. Miller Professor
  • Professor of Health Care Management, and Professor of Insurance and Risk Management
  • Chair, Health Care Management Department

Contact Information

  • office Address:

    206 Colonial Penn Center
    3641 Locust Walk
    Philadelphia, PA 19104

Research Interests: health care finance, health care reform, insurance economics, finance, and regulation, risk management

Links: CV, Personal Website


Scott E. Harrington, Ph.D. ( is the Alan B. Miller Professor in the Health Care Management and Insurance and Risk Management departments at the Wharton School, University of Pennsylvania. He is an adjunct scholar for health policy at the American Enterprise Institute. A former President of both the American Risk and Insurance Association and the Risk Theory Society, he is a Co-Editor of the Journal of Risk and Insurance and has published widely on the economics and regulation of insurance. A frequent speaker on insurance markets, regulation, and public policy, he has conducted research, consulted, or served as an expert for many organizations. He has testified before the U.S. House and Senate and before numerous U.S. state legislative and administrative committees. He currently teaches classes on health care financial management, health policy, and healthcare econometrics.

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  • Scott E. Harrington (Forthcoming), Cost of Capital for Pharmaceutical, Biotechnology, and Medical Device Firms, The Handbook of the Economics of the Biopharmaceutical Industry.

  • Scott E. Harrington (Working), Insurance Regulation and the Dodd-Frank Act.

    Abstract: This paper discusses a number of key issues regarding implementation by the Financial Stability Oversight Council (FSOC) and the Federal Insurance Office (FIO) of the Dodd-Frank Act’s provisions affecting insurance. The paper emphasizes the fundamental differences between insurance and banking, including much lower potential for systemic risk and substantial market discipline in insurance, and how those differences favor solvency regulation and guaranty systems that reflect the distinctive features of each sector. The FSOC and FIO should carefully consider those differences in their analyses of possibly systemically important insurance companies and in the FIO’s study and report to Congress on insurance regulation. Particular attention should be paid to the relatively low systemic risk and relatively strong market discipline in insurance compared with banking.

  • Scott E. Harrington (Working), Incentivizing Comparative Effectiveness Research.

    Abstract: Comparative effective research (CER) compares alternative methods of preventing, diagnosing, treating, and otherwise managing medical conditions. The Patient Protection and Affordable Care Act authorized creation and funding of an independent agency, the Patient-Centered Outcomes Research Institute, to expand CER in the U.S. A key issue in the years ahead is the extent to which public investment in CER and related initiatives should be further expanded in an attempt to improve the efficiency of healthcare spending, limit cost growth, and reduce projected deficits for Medicare and Medicaid. This study provides an overview and analysis of public funding of CER and the desirability and feasibility of incentivizing additional CER in the private sector. It explores key impediments to higher private spending on CER, the rationales for increased public investment, the potential benefits and inherent limitations of publicly-funded CER, and the advantages of pursuing a multifaceted approach to increase private sector, entrepreneurial investment in CER.

  • Scott E. Harrington (Working), Regime Change for Health Insurance Regulation: Rethinking Rate Review, Medical Loss Ratios, and Informed Competition.

  • Guy David and Scott E. Harrington (2010), Population Density and Racial Differences in the Performance of Emergency Medical Services, Journal of Health Economics, July 2010, Vol. 29(4), pp 603-615. 10.1016/j.jhealeco.2010.03.004

    Abstract: This paper analyzes the existence and scope of possible racial differences/disparities in the provision of emergency medical services (EMS) response capability (time from dispatch to arrival at the scene and level of training of the responding team) using data on approximately 120,000 cardiac incidents in the state of Mississippi during 1995–2004. The conceptual framework and empirical analysis focus on the likely effects of population density on the efficient production of EMS as a local public good subject to congestion, and on the need to control adequately for population density to avoid bias in testing for racial differences. Models that control for aggregate population density at the county-level indicate “reverse” disparities: faster estimated response times for African-Americans than for whites. When a refined county-level measure of population density is used that incorporates differences in African-American and white population density by Census tract, the reverse disparity in response times disappears. There also is little or no evidence of race-related differences in the certification level of EMS responders. However, there is evidence that, controlling for response time, African-Americans on average were significantly more likely to be deceased than whites upon EMS arrival at the scene. The overall results are germane to the debate over the scope of conditioning variables that should be included when testing for racial disparities in health care.

  • Scott E. Harrington (2010), The Health Insurance Reform Debate, The Journal of Risk and Insurance, 77: 5-38.

    Abstract: This article provides an overview of the U.S. health care reform debate and legislation, with a focus on health insurance. Following a synopsis of the main problems that confront U.S. health care and insurance, it outlines the health care reform bills in the U.S. House and Senate, including the key provisions for expanding and regulating health insurance, and projections of the proposals’ costs, funding, and impact on the number of people with insurance. The article then discusses (1) the potential effects of the mandate that individuals have health insurance in conjunction with proposed premium subsidies and health insurance underwriting and rating restrictions, (2) the proposed creation of a public health insurance plan and/or non-profit cooperatives, and (3) provisions that would modify permissible grounds for health policy rescission and repeal the limited antitrust exemption for health and medical liability insurance. It concludes by contrasting the reform bills with market-oriented proposals and with brief perspective on future developments.

  • Scott E. Harrington (2009), The Financial Crisis, Systemic Risk, and the Future of Insurance Regulation, The Journal of Risk and Insurance, 76: 785-819.

    Abstract: This article considers the role of American International Group (AIG) and the insurance sector in the 2007–2009 financial crisis and the implications for insurance regulation. Following an overview of the causes of the crisis, I explore the events and policies that contributed to federal government intervention to prevent bankruptcy of AIG and the scope of federal assistance to AIG. I discuss the extent to which insurance in general poses systemic risk and whether a systemic risk regulator is desirable for insurers or other nonbank financial institutions. The last two sections of the article address the financial crisis's implications for proposed optional and/or mandatory federal chartering and regulation of insurers and for insurance regulation in general.

  • Scott E. Harrington, Patricia M. Danzon, Andrew J. Epstein (2008), ‘‘Crises’’ in medical malpractice insurance: Evidence of excessive price-cutting in the preceding soft market, Journal of Banking & Finance, 32: 157–169.

    Abstract: Prior work suggests that heterogeneous information or weak incentives for solvency could have caused some general liability insurers to charge low ex ante prices during the early 1980s and mid-to-late 1990s, putting downward pressure on other firms’ prices and plausibly aggravating subsequent periods of rapid premium growth. We analyse whether the 1994–1999 “soft” market in medical malpractice insurance led some firms to underprice, grow rapidly, and subsequently experience upward revisions in loss forecasts (“loss development”), which could have aggravated subsequent market “crises”. Consistent with the underpricing hypothesis, the results indicate a positive relation between loss development and premium growth among growing firms. Underpricing was likely more prevalent among non-specialist malpractice insurers.

  • Neil A Doherty, Esther Goldsmith, Scott E. Harrington, Howard Kunreuther, Erwann Michel-Kerjan, Mark V. Pauly, Irv Rosenthal, Peter Schmeidler, TRIA and Beyond: Terrorism Risk Financing in the U.S (2005)

  • Patricia M. Danzon and Scott E. Harrington (2001), Workers’ Compensation Rate Regulation: How Price Controls Increase Costs, Journal of Law and Economics, 44 (1), pp. 1-36.

    Abstract: In the 1980s, regulation constrained workers’ compensation insurance premiums in the face of rapid growth in loss costs. We develop and test the hypothesis that rate suppression exacerbates loss growth, leading to higher losses and premiums. The empirical analysis using rating class data for eight states for the period 1985–91 confirms that rate suppression, measured by lagged residual-market share of payroll, increased loss growth. The cost-increasing effects are greater in the residual market than in the voluntary market, but premiums increased more rapidly in the voluntary market. The resulting pattern of cross subsidies between and within classes is consistent with a simple model of political influence, with subsidies to high risks and small firms at the expense of low risks and insurer equity.


Past Courses


    This introductory course takes a policy and politics angle to health care's three persistent issues - access, cost and quality. The roles of patients, physicians, hospitals, insurers, and pharmaceutical companies will be established. The interaction between the government and these different groups will also be covered. Current national health care policy initiatives and the interests of class members will steer the specific topics covered in the course. The course aims to provide skills for critical and analytical thought about the U.S. health care system and the people in it.


    This course focuses on health care organizations' financial decisions in the changing health care landscape. Upon completion of the course, students will be able to utilize a range of financial tools and techniques for making value-added financial decisions in a variety of important contexts in the health care sector. The course involves case analyses and lectures, including presentations by practitioners with extensive real world experience. The course is organized around cases dealing with publicly-traded health care company valuation, valuation and return on investment of biopharmaceutical and medical technology development projects, valuation and deal structure for startup and early stage health care organizations, health plan pricing and finance, and health care provider risk-sharing arrangements. Each case is accompanied by background on tools, methods, institutions, and markets. Students seeking careers in health care finance and financial decision making. Students with more background will extend and enhance their analytical skills in a variety of important areas.


    This seminar will explore empirical methods in health care research with an emphasis on applications in health care economics and finance. The methods covered include estimation with panel data, program evaluation models, qualitative and limited dependent variable models, stochastic frontier models, estimation with count data, and duration models. The readings consist of a blend of classic and recent empirical studies, including articles on the demand for health care and health insurance, tests for moral hazard and adverse selection, and estimation of provider cost functions. Students are required to conduct an econometric analysis of some issue within the health care field. With the permission of the instructor, the seminar is open to doctoral students from departments other than Health Care Systems.


Latest Research

Scott E. Harrington (Forthcoming), Cost of Capital for Pharmaceutical, Biotechnology, and Medical Device Firms, The Handbook of the Economics of the Biopharmaceutical Industry.
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In the News

The Clock Is Ticking for a Health Care Vote

There is little agreement about what needs to be done to fix America's health care system -- and experts agree that a quick resolution seems like a remote possibility.

Knowledge @ Wharton - 2017/07/12
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