People make poor decisions when buying health insurance. So demonstrates health economist Austin Frakt in a review of studies probing Americans' health insurance decisions and knowledge base. Frakt cites studies finding that:
The upshot: When choosing among Medicare plans, employer-sponsored plans, or private plans on offer in the Affordable Care Act marketplace, we all need help.
But what kind of help? That depends, in part, on the menu of choices. And the ACA marketplace is unique -- different in at least one vital way from the markets for Medicare or employer-sponsored plans.
- most people choose wrong when faced with relatively small tradeoffs between premium and deductible;
- Americans have a poor grasp of core insurance terms like "coinsurance;
- low income people will choose a plan labeled "gold" over one labeled "bronze" even if the "gold" plan is manifestly inferior (researchers swapped the labels to test comprehension); and
- when given an estimate of our yearly medical costs, a typical ACA marketplace shopper can't determine which plan would cost them least.
The upshot: When choosing among Medicare plans, employer-sponsored plans, or private plans on offer in the Affordable Care Act marketplace, we all need help.
But what kind of help? That depends, in part, on the menu of choices. And the ACA marketplace is unique -- different in at least one vital way from the markets for Medicare or employer-sponsored plans.
