How can I pay this bill?: the role of social influence in compliance with medical bill payment

Abstract

In two pilot studies, and two full studies, I examined the use of two social influence tactics: 1) normative cues and 2) default option messaging in billing correspondence and its effect on patient compliance with medical bill payment. In the two main studies following my two pilot studies, I integrated social influence theory and behavioral economics to extend my findings and add to the literature on social influence and consumer behavior patterns in healthcare markets as it relates to behavioral economics. With respect to social influence, I utilized Cialdini's (2009) principles of social influence (authority, social validation, commitment, etc.) and the Elaboration Likelihood Model (ELM; Petty & Cacioppo, 1986) as my theoretical framework. The ELM posits that persuasive messages are processed by one of two routes: central or peripheral. Central processing occurs when an individual is thinking carefully about a persuasive message and considering the merit of the persuasive argument. This takes more cognitive energy and resulting changes in attitudes tend to be longer lasting. When a persuasive message is processed peripherally, individuals are paying more attention to cues accompanying the message such as: attractiveness of the influence agent and quantity of the arguments. Furthermore, an individual's own ability or motivation to engage in cognitive processing also affects which route people use to process social influence appeals. Social influence and behavioral economics, are both used as the theoretical framework for the four studies reported in this Dissertation.. In my first pilot study, I hypothesized normative cues would increase the number of payments from healthcare consumers by suggesting the use of available cash from Federal tax refunds (Cialdini & Goldstein, 2004). To examine this, the first pilot study used a correspondence letter utilizing a normative cue containing social validation information that stated: "Many people plan on using this year's tax refund to pay their bill. You may want to consider doing the same." Half the subjects - those in the experimental condition -- received the manipulation in a letter that arrived eight days before the actual invoice. All participants received the invoice without a normative cue. Results indicated that, experimental subjects were significantly more likely to pay relative to control subjects. In the second pilot study, experimental participants received the same manipulation as an invoice. Again, results indicated that experimental subjects were significantly more likely to pay relative to control subjects. These results suggested normative information can increase patient-consumers' compliance with medical bill payment and led to the design of two follow up studies that examined different cues and patient-consumer information (Study 1) as additional variables. Thus, our first main study (Study 1) used normative cues suggesting patient-consumers make payments that varied by experimental condition. As with the pilot studies, the following three normative cues were used on invoice letters: "Most patients in your situation make a first time payment around $115.00. Consider making a similar payment";"23% of patients receiving this letter pay within two weeks"; and "Most patients in your situation make a first time payment within two weeks. You may want to consider doing the same". Our results revealed that patient-consumers complied more with payment in experimental conditions more often versus control, although there were also significant differences between the experimental groups with the 23% group paying less that the other experimental groups. This is likely because this manipulation provided negative normative feedback that less than ¼ of people like them complied with the payment request. The second full study (Study 2) utilized default options - a manipulation typically seen in behavioral economics studies (Beshears et. al, 2009). I expected to conceptually replicate the default effect reported in clinical research (Lowenstein, 20007; Halpern, 2007) and replicating the finding of the three previous studies. In this study, two correspondence letters sent to patients included either an opt-in or a control message for payment plan enrollment. In order to ease the medical debt burden and make payments more manageable, I predicted the opt-in enrollment for payment plans to increase patient-consumer compliance for accounts paid and/or enrollment in payment plans. Unfortunately, preliminary analyses indicated that the data were not properly randomized, but did yield outcomes consistent with previous studies, and inconsistent with the randomization failure, indicating the opt-in letter increased compliance of payment versus control. Overall, these studies provide new knowledge about ways to help consumers reduce medical debt by increasing their compliance regarding medical bills (Kahneman & Tversky, 1979; Hastie & Dawes, 2001; Thaler, 2004).