It’s Not Just You: Picking a Health Insurance Plan Is Really Hard

By Margot Sanger-Katz: For Complete Post, Click Here…

Most Americans make poor choices. So do most professional insurance brokers, a new study finds. But robots may help.

For most Americans, with or without a Ph.D in economics, right now is the time to pick your health insurance. Medicare beneficiaries can choose a Medicare Advantage plan or a Part D prescription drug plan. People with coverage at work can choose from the options their employers offer. People who buy their own insurance can make a choice on the Obamacare marketplace in their state. In Seminole County, Fla., right now, Obamacare customers can choose among 174 different health plans.

(I)t turns out in real life most people are terrible at picking the health plan that is right for them. Health insurance is a complicated financial product, and study after study has shown that people routinely pick bad plans, even choosing options that leave them worse off financially in every possible scenario. And, because people are so bad at choosing good plans, the market often sends weird signals to insurance companies, encouraging them to offer more of the wrong plans instead of the right ones.

People who worked in the insurance industry and had advanced degrees made a good choice about 30 percent of the time. And only about 40 percent of trained statisticians — the group with the best performance — chose good plans for their needs.

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