Article

Enrollment in Prescription Drug Insurance: The Interaction of Numeracy and Choice Set Size

Health Psychology (Impact Factor: 3.95). 06/2013; 33(4). DOI: 10.1037/a0032738
Source: PubMed

ABSTRACT Objective: To determine how choice set size affects decision quality among individuals of different levels of numeracy choosing prescription drug plans. Method: Members of an Internet-enabled panel age 65 and over were randomly assigned to sets of prescription drug plans varying in size from 2 to 16 plans from which they made a hypothetical choice. They answered questions about enrollment likelihood and the costs and benefits of their choice. The measure of decision quality was enrollment likelihood among those for whom enrollment was beneficial. Enrollment likelihood by numeracy and choice set size was calculated. A model of moderated mediation was analyzed to understand the role of numeracy as a moderator of the relationship between the number of plans and the quality of the enrollment decision and the roles of the costs and benefits in mediating that relationship. Results: More numerate adults made better decisions than less numerate adults when choosing among a small number of alternatives but not when choice sets were larger. Choice set size had little effect on decision making of less numerate adults. Differences in decision making costs between more and less numerate adults helped explain the effect of choice set size on decision quality. Conclusions: Interventions to improve decision making in the context of Medicare Part D may differentially affect lower and higher numeracy adults. The conflicting results on choice overload in the psychology literature may be explained in part by differences amongst individuals in how they respond to choice set size. (PsycINFO Database Record (c) 2013 APA, all rights reserved).

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    ABSTRACT: Objective To investigate the determinants and quality of coverage decisions among uninsured choosing plans in a hypothetical health insurance marketplace.Study SettingTwo samples of uninsured individuals: one from an Internet-based sample comprised largely of young, healthy, tech-savvy individuals (n = 276), and the other from low-income, rural Virginians (n = 161).Study DesignWe assessed whether health insurance comprehension, numeracy, choice consistency, and the number of plan choices were associated with participants' ability to choose a cost-minimizing plan, given their expected health care needs (defined as choosing a plan costing no more than $500 in excess of the total estimated annual costs of the cheapest plan available).Data CollectionPrimary data were collected using an online questionnaire.Principal FindingsUninsured who were more numerate showed higher health insurance comprehension; those with more health insurance comprehension made choices of health insurance plans more consistent with their stated preferences; and those who made choices more concordant with their stated preferences were less likely to choose a plan that cost more than $500 in excess of the cheapest plan available.Conclusions Increasing health insurance comprehension and designing exchanges to facilitate plan comparison will be critical to ensuring the success of health insurance marketplaces.
    Health Services Research 04/2014; 50(1). DOI:10.1111/1475-6773.12181 · 2.49 Impact Factor

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