Policy Choice and Product Bundling in a Complicated Health Insurance Market: Do People Get It Right?

Nathan Kettlewell

Journal of Human Resources, 2020, vol. 55, issue 2, 566-610

Abstract: Understanding how consumers choose health insurance and the quality of those choices is crucial information for policymakers. This paper uses a choice experiment to evaluate choice quality and how this interacts with an important form of complexity—product bundling. The results indicate that consumers are likely to make choices that violate expected utility theory, use heuristic decision strategies, and overinsure relative to minimizing out-of-pocket costs. Product bundling is found to exacerbate all of these tendencies. The experimental approach used overcomes some limitations of revealed preference research in this area, such as the endogeneity of choosing bundled insurance.

JEL-codes: D03 D81 I13 (search for similar items in EconPapers)
Date: 2020
Note: DOI: 10.3368/jhr.55.2.0417-8689R1
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Citations: View citations in EconPapers (7)

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Related works:
Working Paper: Policy Choice and Product Bundling in a Complicated Health Insurance Market: Do People get it Right? (2016)
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Persistent link: https://EconPapers.repec.org/RePEc:uwp:jhriss:v:55:y:2020:i:2:p:566-610

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