Information Gaps and Health Insurance Enrollment: Evidence from Affordable Care Act Assister Programs

Abstract

I study changes in health insurance coverage associated with a large government initiative to help people understand and compare their health insurance options. Funding for the initiative was not associated with increased rates of marketplace coverage, but was associated with increased uptake of free Medicaid coverage in expansion states. Novel data on the policy’s target population, people with low insurance literacy, show potential mechanisms: 69% had over-estimated the generosity of insurance, and 36% were income eligible for Medicaid but unaware. These findings demonstrate the importance of measuring the beliefs and characteristics of the targeted individuals when designing and evaluating policy.