Intervening with Consumers to Improve Choices on Health Insurance Marketplaces
The Affordable Care Act dramatically expanded the use of regulated marketplaces to provide individuals with health insurance coverage. The efficiency of these marketplaces depends on the ability of consumers to choose plans that reflect their preferences, but inattention and information frictions may inhibit optimal choices. In this project, researchers will conduct a randomized intervention to test the effect of sending information about the potential to switch plans and save on insurance premiums. Researchers will provide one random subset of re-enrolling individuals in Colorado's health insurance marketplace, Connect for Health Colorado, with personalized information about potential savings in two letters and two e-mails. They will send another random subset of re-enrolling individuals generic information about potential savings in two letters and two e-mails. Researchers will test the effect of these interventions on whether an individual switches her plan, the amount of her plan premium, and the breadth of her plan provider network. Researchers will also estimate the effect of the information on elasticities with respect to plan premiums and provider networks. The results of this study will shed light on behavioral frictions in health insurance and economic parameters central to market design. The study will also provide evidence on inexpensive, effective strategies for marketplaces and policymakers to improve consumers’ decision-making in selecting health plans.
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