Nothing Matters: The Zero-Price Effect in the Individual Insurance Market

This study will use enrollment data from the Colorado exchange to study how the advent of zero-premium plans affected (1) insurance take-up among different demographic groups and (2) the types of health plans chosen by enrollees. Models will isolate the impact of premium levels vs. zero-price plans and also examine the impact of inertia that makes current enrollees less likely to change plan choice in response to premium changes. Study results will be relevant to current policy proposals such as public options, Medicaid buy-ins and higher premium subsidies that may result in more people having access to zero-premium plans.