Health Care Consumerism and Price Shopping
In response to increasing health care spending, many insurers and employers have increased consumer cost-sharing. The hope is that the increased “skin in the game” will lead consumers to shop for health care providers. This session examines the effectiveness of two recent insurance benefit designs, high-deductible health plans (HDHPs) and reference pricing, on consumer price shopping. Mehrotra and co-authors asses consumer willingness and ability to price-shop. While nearly all consumers express an interest in price shopping, only about 10% of consumers actually price shop. Further, enrollment in a HDHP has little effect on price shopping. Sood et al. use a large claims database that covers multiple employers to test if enrollment in a HDHP leads to price shopping for primary care physician visits. Consistent with the survey results, they do not find strong evidence that HDHP enrollment leads to price shopping. Whaley et al. examine an insurance plan, reference pricing, that uses targeted cost sharing as an incentive for consumers to receive care from less expensive providers. They find that a reference pricing program for laboratory tests implemented by a large retailer leads to increases consumer price shopping. As consumers shift demand from high-priced to low-priced providers, they estimate an approximately 30% decrease in spending per test.