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Attributes Important to Medicare Beneficiaries Making Health Plan Choices: A Conjoint Analysis Decision- Making Experiment Sunyna S. Williams, PhD, CMS.

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Presentation on theme: "Attributes Important to Medicare Beneficiaries Making Health Plan Choices: A Conjoint Analysis Decision- Making Experiment Sunyna S. Williams, PhD, CMS."— Presentation transcript:

1 Attributes Important to Medicare Beneficiaries Making Health Plan Choices: A Conjoint Analysis Decision- Making Experiment Sunyna S. Williams, PhD, CMS Jack H. Fyock, PhD, MSI

2 Acknowledgments & Disclaimer Thanks to Chris Smith Ritter, Kelly Dougherty, Catherine Jo, and Sara Bentley for their contributions to this research. The statements expressed here are those of the authors and do not necessarily reflect the views or policies of the Centers for Medicare & Medicaid Services or Market Strategies, Inc.

3 In anticipation of MMA, we were interested in learning about how Medicare beneficiaries make trade-offs among various attributes when making health plan choices. Recent studies, primarily looking at employees, found that people do make trade-offs, and willingness to make different kinds of trade-offs varies by demographics and health status. A couple of studies that looked at Medicare beneficiaries found that premiums and drug benefits were most important, and many chose more tightly managed care to obtain other benefits. Introduction

4 To examine health care decision-making among Medicare beneficiaries, we conducted a conjoint exercise, in which participants made a series of choices among hypothetical plans that varied in terms of several attributes. We also looked at how attribute preferences and trade-offs varied across subgroups, such as those who have Medigap vs. Managed Care, those who are lower-income, and those who have high drug costs. And, we looked changes over time in plan choices with the introduction of the MMA Preventive Services and Drug Benefit provisions.

5 Method DatesJuly-September 2003 LocationsPhiladelphia, PA; Los Angeles, CA; Atlanta, GA; Chicago, IL ParticipantsNearly 300 Medicare senior beneficiaries ~65% under 75 years ~65% female ~85% white

6 Method Participant Subgroups ~60% Original Medicare with Medigap (vs. Managed Care) ~35% Lower-Income (Single <$18,500 or Married <$22,233) ~40% Medigap with High Rx Spending (>$250 per month)

7 Method The study method was a conjoint analysis within- subjects decision-making experiment, for which each participant made a series of choices among hypothetical plans that varied in terms of several attributes. There were 17 trials. Each trial involved making a choice among three hypothetical plan options. Plan attributes included prescription drug coverage, preventive services, doctor choice, plan premium, etc., with 2-3 levels per attribute.

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9 Analytic Plan 1.Average ImportanceAnalysis of conjoint data to assess how beneficiaries weight different attributes when making a choice 2.Market SimulationAnalysis of conjoint data to classify beneficiaries into product shares of preference based on their choices

10 Average Importance AttributesOverallMedigapManaged Care Physician Choice Preventive Services Out-of-Area Coverage Plan Premium Rx Coverage Vision and Dental Coverage Quality / Customer Satisfaction

11 Average Importance AttributesOverall Medigap Low Rx Spend Medigap High Rx Spend Physician Choice Preventive Services Out-of-Area Coverage Plan Premium Rx Coverage Vision and Dental Coverage Quality / Customer Satisfaction

12 Average Importance AttributesOverallLower Income Higher Income Physician Choice Preventive Services Out-of-Area Coverage Plan Premium Rx Coverage Vision and Dental Coverage Quality / Customer Satisfaction

13 Market SimulationCurrent Current – FFS+Supp. Any Doctor No Preventive Services Out of Area Coverage Monthly Premium $120 No Rx coverage No Vision and Dental Satisfaction Good Current – Medicare Advan. Network of Doctors Preventive Services No Out of Area Coverage Monthly Premium $60 Rx coverage $1200 No Vision and Dental Satisfaction Good Vs.

14 Market Simulation – FFS+Supp. Any Doctor Preventive Services Yes Out of Area Coverage Monthly Premium $120 No Rx coverage No Vision and Dental Satisfaction Good Current – Medicare Advan. Network of Doctors Preventive Services No Out of Area Coverage Monthly Premium $60 Rx coverage $1200 No Vision and Dental Satisfaction Good Vs.

15 Market Simulation – FFS+Supp. Any Doctor Preventive Services Yes Out of Area Coverage Monthly Premium $120 Rx coverage $1200 No Vision and Dental Satisfaction Good Current – Medicare Advan. Network of Doctors Preventive Services No Out of Area Coverage Monthly Premium $60 Rx coverage $1200 No Vision and Dental Satisfaction Good Vs.

16 Market Simulation Overall Overall ModelFFS+SupplementMedicare Advantage Current

17 Market Simulation Medigap vs. Managed Care MedigapManaged Care ModelFFS+Supp.Medicare Advan.FFS+Supp.Medicare Advan. Current

18 Market Simulation Medigap High vs. Low Rx Spending Low SpendersHigh spenders ModelFFS+Supp.Medicare Advan.FFS+Supp.Medicare Advan. Current

19 Market Simulation Lower vs. Higher Income Lower IncomeHigher Income ModelFFS+Supp.Medicare Advan.FFS+Supp.Medicare Advan. Current

20 Conclusions Overall, we found that after plan premium, drug coverage was the most important attribute, and that preventive services was moderately important. Not surprisingly, therefore, with the addition of the MMA provisions, the very strong preference for managed care decreases and then seems to disappear. Interestingly, although the strength of the preference decreases over time, those currently in managed care consistently prefer managed care.

21 Conclusions Future research should also look at variables other than attributes that could affect health care choices, such as preference for one-stop shopping or motivation and skill to be an active consumer. These findings have implications both for beneficiary education and decision-support initiatives by Medicare and other stakeholders and for plan marketing activities.


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