Rational Ignorance and Healthcare

    When we were discussing the idea of rational ignorance in class, I immediately thought about healthcare. As I'm sure everyone knows, healthcare is extremely complex and difficult to understand for most. There have been recent initiatives that you can read about here from NPR to increase price transparency, but as the researcher from the article says, "there is data out there, it's just not accessible to mere mortals." Finding the data and genuinely understanding it is something most of the American population is not able to do. Personally, I am lucky to be on my parents' insurance until I turn 26 -- for this reason, you could definitely call me ignorant when it comes to healthcare. All I know is I need to bring my insurance card and money for the copay when I have a doctors appointment. In economic terms, my optimal amount of knowledge is very little, and my optimal amount of ignorance is very high. This is because, since understanding the healthcare industry would take so long, and it is not really necessary at this stage in my life, the marginal benefit of trying to learn about healthcare, prices, etc. is less than the marginal cost, and the opportunity cost is very high as well, because I could be using my time more efficiently doing other things such as studying for classes. 

    In a few years, however, I will be off my parents' health insurance, and I will be on my own in understanding more about the healthcare industry. So despite the fact that my optimal amount of knowledge is so low right now, it will get a lot higher a little bit too soon. For people who do not have health insurance, similarly, it is rational to have more knowledge than ignorance on this topic in cases where they need to go to the doctor or have a special operation. While there are many initiatives to make the healthcare industry more transparent and understandable to the mere mortal, this will be an extremely long and drawn out process. When thinking about rational ignorance in the healthcare industry, it is clear that the level of rational ignorance varies for individuals at different times of their lives. Many of us are lucky enough right now to have a low optimal amount of knowledge, but before we know it this will no longer be the case.