Does targeted information impact consumers' preferences for value-based health insurance? Evidence from a survey experiment.

OBJECTIVES

Value-based insurance design (VBID) aims to direct consumers' preferences by incentivizing the use of high-value care and discouraging the use of low-value care. However, consumers often have limited knowledge of health insurance and the health insurance system, possibly distorting their preferences. In this study, we aim to investigate the impact of specific information treatments on consumers' preferences for VBID.

METHODS

We implemented an information experiment as part of a representative survey on health insurance literacy and preferences for VBID within Switzerland's choice-based health insurance system. Preferences for VBID were measured through a discrete choice experiment. Cross-sectional data on 6,033 respondents aged 26-75 were analyzed using descriptive statistics and mixed logit regressions.

RESULTS

Respondents showed strong preferences for their current health insurance instead of VBID alternatives. A general description of current regulations on cost-sharing, drug disbursement, and monthly premiums significantly increased preferences for VBID (p < 0.01). Pointing respondents specifically to VBID further reduced the opposition against VBID plans. At the same time, there is evidence for anchoring effects in copayments after receiving the information treatments, irrespective of the value of the care.

CONCLUSIONS

The results of this study highlight that individuals are susceptible to provided information about health insurance when building their preferences for VBID. One potential explanation is limited health insurance literacy, implying that tailored communication strategies may be needed to improve insurance decision-making.

JEL CLASSIFICATION

I11, I13.