Salience and health insurance choice
Presenter
Ph.D. Candidate in Economics
Abstract
There are two facets about selecting health insurance in the United States context that may implicate consumer choice behavior. First, health plans can be highly complicated, which may result in inattention due to consumers being misinformed about how different plans, and features, implicate their health or financial outcomes. Second, selecting health plans requires a degree of prospection about one’s own health or financial outcomes, given risks. Individuals, though, may actively choose to avoid information, for a number of reasons, even despite it being freely accessible. In this paper, using an online health lottery experiment, I will disentangle these two potential mechanisms (inattention versus avoidance) by studying how risk aversion shifts when people are taught information that makes (a) health and (b) financial aspects of health plans salient, along with information making losses salient. For external validity, I will bolster my online experiment using real insurance choice data based on a quasi-experimental setting, wherein I study whether uninsured individuals who were exposed to family members who experienced negative health shocks in the past year (a proxy for salience) become more likely to take-up insurance plans. My findings will help inform policy about the type and modality through which information ought to be shared with consumers of health insurance.