Health insurance marketplaces offer better decision-making tools, but cost estimates vary widely

June 20, 2018
Charlene Wong, MD, MSPH

From November 2016 to January 2017, more than 12 million Americans selected a health insurance plan on the Affordable Care Act’s public marketplaces and many others used federally approved private online exchanges to select a health plan.

In a study published in the Journal of General Internal Medicine, Charlene Wong, MD, MSHP, and colleagues from the University of Pennsylvania evaluated consumer-facing web sites to evaluate how the choice environments and availability of decision tools, comparing these resources with those available in the previous year’s open enrollment period. These tools include decision aids like estimators for total out-of-pocket costs, provider lookup, drug lookup and pop-up definitions of insurance and health terminology.

One of the most influential tools for consumers may be those that offer total cost estimates that integrate the premium cost with deductibles and estimates of copays or coinsurance that are based on the consumer’s anticipated use of health care in the upcoming year.  However, in the 2016-2017 open enrollment period, the research team found that the same health insurance plan considered by the same patient had widely varying total costs on the public and private exchanges – an average of $1526 for the same plan in each state reviewed.

“Decision support tools are valuable, but only if consumers understand them and if they are accurate,” said Dr. Wong. “We are encouraged that the exchange sites we reviewed all have provider lookup mechanisms – an important factor for continuity of care and avoiding high out-of-network charges – but many sites still lack information on drug formularies and quality ratings.  Without accurate information on what drugs are covered under a given plan, patients will have difficulty assessing how much they may owe for prescriptions under a new plan.”

The team also found that the proportion of exchanges presenting plans in order of premium cost has decreased, while best fit and total cost estimate options have increased.  Dr. Wong and her colleagues at Duke-Margolis, Dr. Peter Ubel and Annabel Wang, previously found that the order in which plans are presented can influence consumer choice.  For 2016-2017, the team found that some private exchanges are making explicit and implicit plan recommendations (for example by flagging a plan as “recommended” or displaying certain plans in a separate display area on the page).  More research is needed on how the features of the choice environment influence consumer plan choices and whether they accurately address consumer needs in the complex decision-making process of selecting a health plan.