Consumer Choice of Plans, Employer Contribution Policy, and Health Plan Price

How do employer premium contribution policies and other (non-price) factors affect employee choice of multiple competing health plans in health plan purchasing cooperatives (HPCs), which allow variations in employer contribution policies while giving employees choice among multiple health plans offering the same (standardized) benefit plan designs? Researchers analyzed data collected from two sites: the Health Insurance Plan of California (HIPC) and HPC in Connecticut. They gathered information from surveys of employers and employees, centralized enrollment files, other consumer information collected by the HPC, and interviews with key actors. Multivariate analyses were conducted in order to determine the effect of premium on plan choice, the effect that employer contribution policy has on the response to higher premiums, the extent to which older workers react differently to financial incentives than do younger workers, and the qualitative non-price factors and influences that are most important in health plan choice. They also investigated whether there are differences in choice patterns between those with employee-only and those with family coverage. The goal of this project was to advance the policy and purchasing fields as to what factors affect employee behavior.