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Journal Publication

When Less is More: Improving Choices in Health Insurance Markets

Published: August 2022
Researchers study the impact of changing choice set size on the quality of choices in health insurance markets.

Using medical enrollment and claims data for school district employees in the state of Oregon, researchers find average potential cost savings of $600. They also find that employees showed consistent biases in their choices, usually choosing a closely-located plan on the plan design spreadsheet when switching, and usually making lower-cost choices when there were fewer options. Researchers conclude that fewer options lead to lower-cost choices not because of information overload, but because more options tends to bring worse choices into the mix.

Abstract and Citation