I am not a communicator…
…I am an economist
…who does policy analysis, primarily
focused on health insurance issues.
How did I get here?
2011: Consumer Testing New
Insurance Disclosures Revealed…
To put this into prespective…
…consumers would prefer to:
Go to the gym or
Pay their taxes
Rather than shop for health insurance.
Source: ehealth, Inc., “New Survey Shows Americans Lack Understanding of Their Health
Coverage and Basic Health Insurance Terminology,” January 3, 2008, available at
Health Insurance Shopping:
What are the Barriers?
Consumers can’t meaningfully distinguish
Consumers may not trust the information
available to them
They realize there are great financial and
health implications for their families
Adds up to anxiety and dreading the
Consumers want a good
“value” but can’t calculate
Consumers care about cost.
But they don’t want the lowest cost plan, they
want the best value plan they can afford.
Notion of value is sophisticated:
•scope of services covered
•share of the cost paid by plan
•sometimes the quality of providers
Consumers are confused by
This is the greatest area of confusion.
They don’t know the vocabulary: deductible,
coinsurance, benefit maximum, allowed amount,
These complex concepts must THEN be used
together to estimate patient’s cost for services (do
copays count towards the deductible?)
Three distinct things were difficult:
Who is paying the indicated percentage?
How to calculate a percent?
What is the percentage applied to? (the
Which would you choose?
Health Plan A or Health Plan B
New term needed:
Health Insurance Literacy
Lit review revealed:
Few studies of
measures of HIL
Health Insurance Literacy?
Health insurance literacy measures the
degree to which individuals have the
knowledge, ability, and confidence to
find and evaluate information about
health plans, select the best plan for
their financial and health circumstances,
and use the plan once enrolled.
Source: Measuring Health Insurance Literacy: A Call to Action,
Consumers Union and partners, February 2012
Is HIL the same as or different
than Health Literacy?
There are at least 26 tools to measure
health literacy BUT health insurance
literacy is different.
A compilation of over
200 studies, none of
which examine health
See also: “Health Literacy Measurement: An Inventory and Descriptive Summary of 51
Instruments,” Journal of Health Communication: International Perspectives Volume
19, Supplement 2, 2014.
Health Insurance Literacy Requires
Term “Health Insurance Literacy”
comes into common usage
New polls measure levels of HIL
Funders interested in HIL
New work on consumer facing tools
A clearinghouse for tools
New Data Confirm Low HIL
Three-quarters confident that they knew how to
use health insurance, but many said they didn’t
look at a plan’s benefits before signing up.
Only one in five could accurately calculate how
much a doctor’s visit would cost when provided
with a plan’s copayment, deductible and
Generally, younger people, those who use fewer
health care services, minorities, people with lower
incomes and those with less education have more
difficulties navigating health insurance.
People learn by doing.
18Notes: English speakers, ages 22-64. http://aircpce.org/wp-
More Evidence for Low HIL
• Americans are confident but actual
understanding is very low
• Only 14 percent accurately understood
deductible, copay, co-insurance and
• 44 percent of consumer assistance
programs had seen people who did not
understand how to use insurance
19Sources: Loewenstein, “Consumers’ misunderstanding of health insurance,” Journal of Health Economics,
September 2013; Kaiser Family Foundation, Survey of Health Insurance Marketplace Assister Programs,
How do we make things better
Get robust, nuanced information about
the challenges consumers face
Use this information to:
improve the underlying products and the
system in which they are purchased,
improve the way products are
And to educate and activate consumers.
Health insurance shopping
has gotten better….
No more pre-existing condition exclusions
No more exceptions to OOPM
No more dollar-denominated annual and
And in non-group market:
Covered services standardized
Plans grouped into actuarial value tiers
Standard set of preventive services
covered at no cost
Have We Done Enough To Help
Consumers Shop For Coverage?
Health insurance is still pretty complex.
Massachusetts’consumer testing found that
additional simplification was needed.
What Does a Health Insurance
Literate Consumer Need to Know?
How health insurance
Where and when to shop
Financial help is available
How to find a plan that meets budget
How to use health
Where to go for help!
Three things to know
about plan choices
1. Premiums and resources that reduce
2. Adequacy of Coverage:
Covered services/drug formularies
3. Does Provider Network include
YOUR doctors and hospitals?
Fixed payment every month
….whether or not you use medical
You can get help paying the premium
Premium isn’t your only cost!
Cost-sharing will vary by whether
providers are in or out of network
To minimize costs, patients should
participate in the plan’s “network”
is what you pay first
Broken arm (waterskiing)
Todd pays: $850
Todd’s plan has a
Todd & plan
Exceptions to Deductible
Free Preventive Health Services
including some vaccinations, mammograms and other cancer
screenings, contraception, including birth control pills, and
periodic physicals. But prevention services do not include
treatment for an illness, such as the flu.
Some plans offer 1-3 primary care
visits before deductible – you have to
If the price for a doctor visit followed by the phrase "after the deductible
is met" the consumer must pay the full deductible before getting doctor
visits for indicated copayment or coinsurance amount.
• Health Insurance Literacy Clearing House for digital tools, fact sheets and
other handouts, and videos to help fill gaps in health insurance literacy
among consumers. http://www.enrollamerica.org/hil/
• Sign up for the Health Insurance Literacy Listserv! Email
• More resources from NASHP:
Health Law Helper – an interactive tool that
explains what the new law means for you √ √
Summary of Benefits and Coverage – a new
form that everyone should know about √
Health Tax Credit Tool – an interactive tool
that explains the new tax credits that help pay
State Specific Tax Credit Brochures √ √
Health Insurance Basics – graphical one
pagers √ √
Fact Sheet: How to Report Your Income √ √
Fact Sheet: What to Do At Tax Time √ √
Fact Sheet: What Is Tax Reconciliation?
Short, interactive guide to
Premium Tax Credit
A Happy Alignment of Goals
If health insurance markets are going
to work, consumers must be able to
play their role as informed, activated
In turn, if consumers are going to
really understand health insurance,
policymakers, funders and
professional communicators must
Failure to Address Consumer
Confusion has Grave Consequences
Consumers underinsured, often leading
to medical bankruptcy
Under-insured consumers act like
uninsured consumers – they delay
Inability to effectively compare plans
undermines the health plan marketplace
Strains customer help lines
Low Health Insurance
… is just one piece of the complex
puzzle of health insurance
New Rules for
To contact me:
lquincy “at” consumer.org