%0 Journal Article %J Med Care Res Rev %D 2020 %T Consumer Numeracy and Insurance Design Decisions: An Examination of Inflation Protection Take-Up Among Private Long-Term Care Insurance Policy Holders. %A Brian E McGarry %A David C Grabowski %K Consumer Behavior %K Decision making %K Humans %K Inflation, Economic %K Insurance, Long-Term Care %K Long-term Care %K Private Sector %K Value-Based Health Insurance %X

Given the rising cost of long-term care (LTC) services, the selection of a private long-term care insurance (LTCi) policy with inflation protection has critical implications for the ability of this coverage to protect against potentially catastrophic LTC expenses. This study examines the effect of consumers' numeric abilities on the decision to add inflation protection to private LTCi policies. Over 40% of current LTCi policies lack inflation protection. Higher scores on a three-question numeracy scale are associated with increases in the probability of choosing inflation protection at the time of policy purchase, with households answering all three questions correctly being 12 percentage points more likely to have this benefit type relative to those with a numeracy score of 0 ( = .002). Market reforms that simplify the task of evaluating LTCi plans and assessing the value of indexed benefits may be needed to ensure that LTCi policy purchasers are selecting adequate protection against future LTC costs.

%B Med Care Res Rev %V 77 %P 187-195 %8 2020 04 %G eng %N 2 %1 http://www.ncbi.nlm.nih.gov/pubmed/30009685?dopt=Abstract %R 10.1177/1077558718787742