Simply providing consumers with good options doesn’t ensure that they will choose wisely. Three economists, Saurabh Bhargava and George Loewenstein of Carnegie Mellon University and Justin Sydnor of the University of Wisconsin, examined the problem in a 2017 paper. They studied an anonymous, large company that gave employees many choices.

The company’s workers could choose fromamong 48 different combinations of deductibles, prescription-drug co-payments, co-insurance rates and maximum out-of-pocket costs. (Each version offered the same network of doctors and hospitals.) The results were troubling: A majority of employees selected financially dominated plans — generally, those with low deductibles, which were worse in every spending scenario.

The employees who picked plans with a deductible of $750 rather than $1,000, for example, were essentially paying $528 to reduce their deductible by $250. That is not smart. But the authors showed that people often do not understand the choices they are making when it comes to health insurance.