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Messaging and the Mandate: The Impact of Consumer Experience on Health Insurance Enrollment through Exchanges

Author

Listed:
  • Natalie Cox
  • Benjamin Handel
  • Jonathan Kolstad
  • Neale Mahoney

Abstract

The ability of web-based retailers to learn about and provide targeted consumer experiences is touted as an important distinction from traditional retailers. In principal, web-based insurance exchanges could benefit from these advantages. Using data from a large-scale experiment by a private sector health insurance exchange we estimate the returns to experimentation and targeted messaging. We find significant improvements in conversions in one treatment tested. Underlying the average impact were both inter temporal and demographic heterogeneity. We estimate that learning and targeted messaging could increase insurance applications by approximately 13 percent of the baseline conversion rate.

Suggested Citation

  • Natalie Cox & Benjamin Handel & Jonathan Kolstad & Neale Mahoney, 2015. "Messaging and the Mandate: The Impact of Consumer Experience on Health Insurance Enrollment through Exchanges," American Economic Review, American Economic Association, vol. 105(5), pages 105-109, May.
    • Handle: RePEc:aea:aecrev:v:105:y:2015:i:5:p:105-09
    Note: DOI: 10.1257/aer.p20151080
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    References listed on IDEAS

    as
    1. Thomas Blake & Chris Nosko & Steven Tadelis, 2015. "Consumer Heterogeneity and Paid Search Effectiveness: A Large‐Scale Field Experiment," Econometrica, Econometric Society, vol. 83, pages 155-174, January.
    2. Randall Lewis & David Reiley, 2014. "Advertising Effectively Influences Older Users: How Field Experiments Can Improve Measurement and Targeting," Review of Industrial Organization, Springer;The Industrial Organization Society, vol. 44(2), pages 147-159, March.
    3. Ericson, Keith M. Marzilli & Starc, Amanda, 2016. "How product standardization affects choice: Evidence from the Massachusetts Health Insurance Exchange," Journal of Health Economics, Elsevier, vol. 50(C), pages 71-85.
    4. Avi Goldfarb, 2014. "What is Different About Online Advertising?," Review of Industrial Organization, Springer;The Industrial Organization Society, vol. 44(2), pages 115-129, March.
    Full references (including those not matched with items on IDEAS)

    Citations

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    Cited by:

    1. Martin Gaynor & Kate Ho & Robert J. Town, 2015. "The Industrial Organization of Health-Care Markets," Journal of Economic Literature, American Economic Association, vol. 53(2), pages 235-284, June.
    2. Kurt Lavetti & Thomas DeLeire & Nicolas R. Ziebarth, 2023. "How do low‐income enrollees in the Affordable Care Act marketplaces respond to cost‐sharing?," Journal of Risk & Insurance, The American Risk and Insurance Association, vol. 90(1), pages 155-183, March.
    3. Jesse M. Hinde, 2017. "Incentive(less)? The Effectiveness of Tax Credits and Cost-Sharing Subsidies in the Affordable Care Act," American Journal of Health Economics, MIT Press, vol. 3(3), pages 346-369, Summer.

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    More about this item

    JEL classification:

    • D12 - Microeconomics - - Household Behavior - - - Consumer Economics: Empirical Analysis
    • G22 - Financial Economics - - Financial Institutions and Services - - - Insurance; Insurance Companies; Actuarial Studies
    • H51 - Public Economics - - National Government Expenditures and Related Policies - - - Government Expenditures and Health
    • H75 - Public Economics - - State and Local Government; Intergovernmental Relations - - - State and Local Government: Health, Education, and Welfare
    • I13 - Health, Education, and Welfare - - Health - - - Health Insurance, Public and Private

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