Working Paper: NBER ID: w19639
Authors: Anna D. Sinaiko; Christopher C. Afendulis; Richard G. Frank
Abstract: Evidence from behavioral economics reveals that decision-making in health care settings can be affected by circumstances and choice architecture. This paper conducts an analysis of choice of private Medicare plans (Medicare Advantage plans) in Miami-Dade County. We provide a detailed description of the choice of MA plans available in Miami over much of the program's history and the composition of Medicare beneficiaries in Miami over the 2000s. Our analysis suggests that first becoming eligible for Medicare is the key transition point for MA, and that there is significant status quo bias in the MA market. This consumer behavior has important implications for policy that regulates the MA market.
Keywords: Medicare Advantage; Status Quo Bias; Health Insurance; Consumer Behavior
JEL Codes: I13
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| Transition to Medicare eligibility at age 65 (J26) | Likelihood of enrolling in MA plans (I18) |
| Enrollment in MA in the previous year (I23) | Likelihood of remaining in MA (C41) |
| Years in Medicare (I13) | Probability of being enrolled in MA (I18) |