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Using contingent choice methods to assess consumer preferences about health plan design.
M Susan Marquis1, Melinda Beeuwkes Buntin, Kanika Kapur
1RAND, Arlington, Virginia 22202, USA. susanm@rand.org
Applied Health Economics and Health Policy
|September 16, 2005
Summary
Consumers value high-quality health insurance and are willing to pay more to reduce financial risk, especially those in poorer health. Tiered benefit designs may be preferred over increased cost-sharing.
Area of Science:
- Health Economics
- Consumer Behavior
- Health Insurance Design
Background:
- Insurers are shifting costs to consumers through new health plan designs.
- Understanding consumer preferences for these designs is crucial.
Purpose of the Study:
- To examine consumer preferences for specific health insurance benefit designs.
- To assess willingness to pay for various health plan attributes.
Main Methods:
- Contingent choice method used to evaluate six health plan attributes.
- Logistic regression models analyzed preferences based on premiums and subscriber characteristics.
- Study sample comprised individual health insurance subscribers in California.
Main Results:
- High-quality healthcare was the most valued attribute.
- Consumers showed willingness to pay significant premiums to reduce financial risk.
- Individuals with poorer health reported higher willingness to pay for risk reduction.
Conclusions:
- Consumers might favor tiered-benefit designs over increased cost-sharing.
- Enhanced consumer education is needed for informed insurance choices.