New Findings in Health Insurance Described by N. Kairies-Schwarz and Co-Researchers (Health insurance choice and risk preferences under cumulative…

New Findings in Health Insurance Described by N. Kairies-Schwarz and Co-Researchers (Health insurance choice and risk preferences under cumulative prospect theory - an experiment)

By a News Reporter-Staff News Editor at Managed Care Weekly Digest -- New research on Health Insurance is the subject of a report. According to news reporting from Essen, Germany, by NewsRx journalists, research stated, "We investigate how consumers choose insurance contracts when using a measure of decision quality based on individual risk preferences. For this, we use a laboratory experiment with a sequential design."

The news correspondents obtained a quote from the research, "First, subjects face insurance choices. Then, we elicit risk preferences. Allowing for different latent decision making theories, i.e. Cumulative Prospect Theory and Expected Utility Theory, we find that the vast majority are Cumulative Prospect Theory types. Analyzing whether subjects choose contracts consistent with their risk preferences, we find that about 14% of all participants show inconsistent behavior and low decision quality. Yet, the majority shows consistent behavior and good decision quality."

According to the news reporters, the research concluded: "Our results suggest that one explanation for inconsistent choices is the application of heuristics."

For more information on this research see: Health insurance choice and risk preferences under cumulative prospect theory - an experiment. Journal of Economic Behavior & Organization, 2017;137():374-397. Journal of Economic Behavior & Organization can be contacted at: Elsevier Science Bv, PO Box 211, 1000 Ae Amsterdam, Netherlands. (Elsevier - www.elsevier.com; Journal of Economic Behavior & Organization - www.journals.elsevier.com/journal-of-economic-behavior-and-organization/)

Our news journalists report that additional information may be obtained by contacting N. Kairies-Schwarz, CINCH Competent Competit & Hlth, D-45127 Essen, Germany. Additional authors for this research include J. Kokot, M. Vomhof and J. Wessling (see also Health Insurance).

Keywords for this news article include: Essen, Germany, Europe, Health Insurance.

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