Benefit design and consumer information: results from a randomized trial

Area of Science:

• Health Services Research
• Health Economics
• Consumer Behavior

Background:

• Consumer inertia significantly impacts healthcare choices, particularly in selecting primary care clinics (PCCs).
• Tiered total cost of care systems aim to influence consumer behavior through cost-sharing structures.
• Understanding factors influencing consumer choice in healthcare is crucial for optimizing health plan design.

Purpose of the Study:

• To evaluate the effectiveness of tailored cost information in reducing consumer inertia when selecting PCCs within a tiered system.
• To determine if direct consumer information during open enrollment can alter clinic choice.

Main Methods:

• A randomized controlled trial was conducted involving individuals with employment-based health insurance.
• Participants were assigned to either a treatment group receiving enhanced PCC cost information via email or a control group.
• Regression analyses assessed the intervention's marginal effect on PCC selection.

Main Results:

• The intervention demonstrated a minimal impact on consumer choice of PCCs.
• Prior to the intervention, approximately 85% of consumers selected PCCs within the two lowest cost-sharing tiers.
• This indicates that tiered benefit designs may inherently address information gaps and price distortions.

Conclusions:

• Targeted informational interventions alone have limited efficacy in overcoming consumer inertia in PCC selection.
• Existing tiered total cost of care benefit designs may sufficiently inform consumers, reducing the impact of additional information.
• Further research may explore other behavioral or systemic factors influencing healthcare consumer choices.