The Engulf & Devour Corporation offers its employees a choice between two health plans. Plan A has a $100 deductible, and $10 copays for doctor visits and hospitalizations. The employee share of the monthly premium is $500. Plan B has a $3000 deductible, $20 copays for doctor visits, and $100 copays for hospitalizations. The employee share of the monthly premium is $100. An analysis of health care utilization among E & D employees reveals that Plan A enrollees use an average of $3000 worth of care per year, while Plan B enrollees use an average of $1500 worth of care.

Discuss the possible explanations for this empirical pattern, as well as the limitations of the data for resolving questions about why this pattern exists.