Design Healthcare Benefits for Good Choices

The way we make decisions is highly contingent on how different options are presented to us. Some of us assume that as long as the options are presented accurately, it doesn’t matter how they are displayed. This is not the case for a variety of reasons ranging from accurate but badly designed layouts to poor understanding of what is being offered. For an example of the former, think of a website circa 1995 versus a contemporary ecommerce site. In 1995, developers were still trying to understand the basics of website design. Crucial information could be present on the page but it was often difficult to find and sometimes poorly rendered. Twenty years later, the architecture and design of websites is still an iterative process, but the leap forward is readily apparent. However, better design doesn’t necessarily lead us to the right choice. Many products are complex. And let’s face it, we don’t often know what we need – particularly when it comes to health insurance.

Research from Consumers Union has shown that even for a purchase as important as health benefits, the majority of people have almost no idea what they’re doing: “the vast majority of consumers are essentially being asked to buy a very expensive product—critical to their health—while blindfolded.” In addition to non-comprehension of insurance offerings, the article points to a broad distrust of health plans with people believing that insurance companies hide necessary information in the fine print. However, insurance companies can help lead us to make better decisions by designing for choice.

The Impact of Choice

Choice architecture describes how any decision we make has an environment or framework behind it. There’s no neutral design where we’re not influenced - even the smallest features can sometimes have a significant impact. Choice architecture is particularly important for the healthcare industry. In the past, employers usually offered their employees only one medical plan with one or two other benefits. Now we’re offered a range of benefit options, but don’t have the guidance to choose which plan is best. In many cases, we’ll have to pay significant out-of-pocket costs without fully understanding what we’re buying. A choice architect guides these decisions with tools that give us the the freedom to choose the plan of our choice but guide us to the plan(s) that would be the best fit.

Choice architecture has numerous components but one interesting concept is designing for failure. When designing products, software, process or technology it’s critical to design for failure. It’s easy to list out and design for success scenarios, but those scenarios aren’t the ones choice architects need to fear. You first have to identify potential failure scenarios. There are many methods depending upon what you’re creating. For example, running actual humans through your products during usability testing helps you to find failure points in your user interaction.

Data is the Foundation

Another useful concept for choice architects is the status quo – people are lazy decision makers. We like defaults and hesitate to make changes. When it comes to benefits, we’ll have to change. Although an opt out default has been highly effective for a 401(k) plan, it may not be practical for benefits. A recommendation, on the other hand, can be a very powerful feature for a benefits platform. Benefits administrators have access to a powerful source for making choice recommendations: user data. Employers and insurance carriers need to make “smart defaults” – recommendations based on the user’s data so they make the right choices for themselves and their families.

Benefitfocus is able to gather data from a variety of sources. Recommendations don’t just come from what someone else may have chosen, but from your unique Benefitfocus Profile, questionnaires, claims information and out-of-pocket costs. These powerful data sets need sophisticated analytics capabilities so that they can be leveraged. Benefitfocus analytics tools allow employers and insurance carriers to access and, more crucially, understand the data they have access to so that important information is at their fingertips. Leveraging this data allows administrators to design a private exchange layout that helps us make benefit decisions based on more than intuition and chance. Hard data is the key to developing tools for showing us the right benefits based on our own historical needs. Get away from gut feelings and use your data to design for choice.

Learn how Benefitfocus can help you make better benefits decisions.

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