American Marketing Association – InsuranceNewsNet

2022 Sep 07 (NewsRx) — By a News Reporter – Staff News Editor at Health policy and daily law — Researchers from Erasmus University, Colombia Universityand University of Pennsylvania published a new article in the Marketing Review which examines how the design of online marketplaces affects consumers’ choice of health insurance policies.

The study, to be published in the Marketing Reviewis titled “Architecture of Choice for Healthier Insurance Decisions: Ordering and Partitioning Together Can Improve Consumer Choice” and is written by Benoit GC Dellaert, Eric J. Johnson, Shannon Duncanand Thomas Baker.

According to WE government. Approximately 10 million of these registrations were made by health.govthe federal insurance market used by 33 states.

Health insurance decisions have strong financial consequences and determine access to potentially life-saving health care. Choosing health insurance forces many consumers to wrestle with complex terms such as deductibles and co-payments. These attributes force consumers to make compromises – since low deductibles lead to higher premiums – and many make costly mistakes in their choices and end up paying too much for coverage. Providing better choices can help consumers make better decisions and thus improve both their health and the efficiency of the healthcare system.

This new research investigates how the design of online marketplaces – called “choice architecture” – affects consumers’ choice of health insurance policies. The researchers show that seemingly minor changes in the architecture of choice can have a large effect on consumers’ choice of health insurance products and health care costs. For example, providing consumers with a default alternative can remove the need for careful thought. Additionally, rapid advancements in the availability of large-scale data, artificial intelligence, and machine learning-based algorithms are helping marketers match products to consumer needs. Combining this information with a choice architecture can help consumers choose the health products that are best for them.

Healthcare exchanges provide opportunities for digital choice architectures to support consumers, particularly because these decisions are both high-impact and infrequent. These exchanges use two ubiquitous choice architecture tools:

“Ordering and partitioning don’t always improve choices separately, but we identify conditions that allow the combination to improve health insurance decisions. When the best health care options appear at the top of the list, partitioning subtly nudges consumers to focus on them, however, if the best options aren’t at the top of the list, partitioning discourages research and can hurt consumers’ discovery of the best options,” says Dellaert.

Consumers should not only pay attention to the right options; they should also avoid paying attention to low-quality options. Johnson explains that “high-quality ordering, based on consumers’ predicted healthcare expenditures, ensures that consumers see the right options, but without effective partitioning, they may search too much, revise their opinions, and settle for When the best options are not presented at the beginning of a set of choices, for example, with a random or low-quality order, partitioning can be detrimental by drawing consumers’ attention to options that are not not really superior.

The results of the study suggest that choice architecture interventions need to consider the joint effect of choice architecture tools as well as the quality of the enterprise user model. The architecture of choice can be a relatively inexpensive and effective way to use enterprise-level knowledge to improve social welfare, and governments can use regulatory oversight to prevent companies from adopting architectures that lead to poorer health insurance choices for consumers – but this will first require an understanding of how choice architecture sets affect consumer choice outcomes and processes. “Healthcare companies can take the lead in developing new business models based on algorithm-driven architectures of choice to deliver longer-term value and minimize waste for customers, other stakeholders, and themselves. “, says Duncan.

For managers, this research highlights the potential tension between the interests of consumers and the profit-maximizing interests of health insurance companies. Thanks to the availability of a lot of data, a health insurer can have a more precise view of the probability and the financial cost of a consumer being involved in an accident or contracting a serious illness. Baker says that “health insurers might be tempted to exploit these informational asymmetries, but there might be another route to greater long-term consumer satisfaction and loyalty, that is, building architectures choices that help consumers make better decisions. Although the economics of this strategy depend on the ability of health insurance companies to develop accurate user models – as well as the requirement that consumers trust these recommendations – an effective system could have a lasting effect. on the lives of individual consumers as well as on the health of society. in general.

Full article and author contact details available at: https://doi.org/10.1177/00222429221119086 Keywords in this news article include: Advertisement, American Marketing Association, Health insuranceHealth and Medicine, Investment and Finance, Legal Issues, Marketing.

(Our reports provide factual information on research and discoveries around the world.)

Comments are closed.