The article explores how tax subsidies for health insurance can lead to people choosing more generous plans than they need. By creating a model of optimal health insurance, the researchers show that the tax subsidy distorts the way people share costs with their insurance plans. This means that the subsidy encourages individuals to buy plans with lower out-of-pocket expenses, even when they may not need such extensive coverage. The researchers used real-world data to confirm that the tax subsidy does indeed impact how people choose their health insurance plans.