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Insurance Law

University of Pennsylvania Carey Law School

Choice architecture

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Choice Architecture For Healthier Insurance Choices: Ordering And Partitioning Can Improve Decisions, Benedict G.C. Dellaert, Eric J. Johnson, Tom Baker Jul 2019

Choice Architecture For Healthier Insurance Choices: Ordering And Partitioning Can Improve Decisions, Benedict G.C. Dellaert, Eric J. Johnson, Tom Baker

All Faculty Scholarship

Health insurance decisions are a challenge for many consumers and influence welfare, health outcomes, and longevity. Two choice architecture tools are examined that can improve these decisions: informed ordering of options (from best to worst) and choice set partitioning. It is hypothesized that these tools can improve choices by changing: (1) decision focus: the options in a set on which consumers focus their attention, and (2) decision strategy: how consumers integrate the different attributes that make up the options. The first experiment focuses on the mediating role of the hypothesized decision processes on consumer decision outcomes. The outcome results are …


Can Consumers Make Affordable Care Affordable? The Value Of Choice Architecture, Eric J. Johnson, Ran Hassin, Tom Baker, Allison T. Bajger, Galen Treuer Jul 2013

Can Consumers Make Affordable Care Affordable? The Value Of Choice Architecture, Eric J. Johnson, Ran Hassin, Tom Baker, Allison T. Bajger, Galen Treuer

All Faculty Scholarship

Starting this October, tens of millions will be choosing health coverage on a state or federal health insurance exchange as part of the Patient Protection and Affordable Care Act. We examine how well people make these choices, how well they think they do, and what can be done to improve these choices. We conducted 6 experiments asking people to choose the most cost-effective policy using websites modeled on current exchanges. Our results suggest there is significant room for improvement. Without interventions, respondents perform at near chance levels and show a significant bias, overweighting out-of-pocket expenses and deductibles. Financial incentives do …