Do Ordeals Work for Selection Markets? Evidence from Health Insurance Auto-Enrollment†

• 成果类型: Article
• 署名作者: Shepard, Mark; Wagner, Myles
• 署名单位: Harvard University; National Bureau of Economic Research; University System of Ohio; Ohio State University
• 刊物名称: AMERICAN ECONOMIC REVIEW
• ISSN/ISSBN: 0002-8282
• DOI: 10.1257/aer.20231133
• 发表日期: 2025
• 页码: 772-822
• 关键词: take-up; adverse selection; COSTS EVIDENCE; plan choice; subsidies; inertia; welfare; Massachusetts; INFORMATION; COMPETITION

摘要

Are application hassles, or ordeals, an effective way to limit public program enrollment? We provide new evidence by studying (removal of) an auto-enrollment policy for health insurance, adding an extra step to enroll. This minor ordeal has a major impact, reducing enrollment by 33 percent and differentially excluding young, healthy, and economically disadvantaged people. Using a simple model, we show adverse selection-a classic feature of insurance markets-undermines ordeals'standard rationale of excluding low-value individuals since they are also low-cost and may not be inefficient. Our analysis illustrates why ordeals targeting is unlikely to work well in selection markets. (JEL D82, G22, H75, I13, I18)