Transcript Mapping Enrollment Behaviors in Medicare Prescription Drug Coverage *

Mapping Enrollment Behaviors in
Medicare Prescription Drug Coverage*
Beth Simon1, Ph.D., Christopher Koepke1, Ph.D., Barbara Allen, MPA,
David Newman2, Ph.D., Andrea Hassol2, MSPH
1 Centers for Medicare & Medicaid Services; 2 Abt Associates Inc.
* With the assistance of Abt Associates staff.
AcademyHealth
June 25, 2006
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Background - 1

The Medicare Modernization Act (MMA) provides seniors and
people with disabilities prescription drug coverage beginning
January 1, 2006

For the first time ever, 43 million Medicare beneficiaries are
now eligible to receive optional prescription drug coverage

Additional assistance available for beneficiaries with low
income and assets

Beneficiaries have a choice of drug plans offered by private
companies approved by Medicare
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Background - 2

Drug coverage can be through a comprehensive healthcare
plan (i.e., Medicare Advantage, HMO, PPO) or through
Original Medicare

Original Medicare drug plans are referred to as PDPs and
coverage through comprehensive plans are MA-PDs

Standard coverage
 Monthly premium
 Deductible ($250/year)
 Cost sharing/coverage gap/catastrophic coverage

Penalty for not joining by May 15, 2006
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Background - 3

There are many standalone PDPs and MA-PDs to choose
from in each state (min: 27, max, 52, mean=43)

Plans differ in coverage, quantity limits, prior authorization,
out of pocket costs, formularies, premiums, deductibles, etc.
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Purpose of the Study

Beneficiaries choose whether to enroll in a Medicare
prescription drug plan and then must select among various
drug plans that may vary by cost, coverage, and other
features (mail order, co-branding)

This study investigates how beneficiaries’ background,
decision making style, and behaviors led to enrollment or
non-enrollment in Medicare prescription drug coverage

Research findings will inform education and outreach efforts
about the Medicare prescription drug benefit
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Research Questions

What are beneficiaries’ decision making behaviors?

Does beneficiaries’ personal decision making style influence
enrollment behaviors?

How do beneficiaries’ background characteristics influence
decision making behaviors and enrollment decision?
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Sample - 1

Fifty in-person interviews conducted in 5 cities
 Round 1: Boston, MA; Phoenix, AZ, Knoxville, TN (total
n=17) January, 2006
 Round 2: Atlanta, GA; San Antonio, TX (total n=33)
April/May 2006

Telephone panel (n=20) of Medicare beneficiaries (1/06-5/06)
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Sample – 2
Interviewees met the following recruitment criteria:
 Medicare beneficiary, 65+
 No existing prescription drug coverage through VA,
current/former employer
 Not a member of an HMO (Medicare Advantage plan)
 No Medicaid
 Mix of race/ethnicity, education, gender, income (+/- $30,000)
 Enrollment status: mix of already or plan to enroll; not
enrolled and don’t plan to; undecided
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Beneficiary Comments -1
“I could go for 9 years and not worry about it, especially
if my health doesn’t change. If costs increased, I’d still
come out ahead. That’s the whole thing…It doesn’t
make sense to shell out money for something I don’t
need.”

“There’s no sense to take out the insurance, unless I
start taking something else on a regular basis.”
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Data Collection - 1

Prior to interview, respondents completed inventory to
measure decision making style (maximizer vs. satisficer from
Barry Schwartz’ The Paradox of Choice: Why More is Less,
2004)

Demographic data collected from screener and during
interview (race/ethnicity, education, income, age, marital
status, current/change in health status, number of Rx drugs
currently on)
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Data Collection - 2

Guide to semi-structured interview designed to elicit
 Respondents’ initial predisposition toward enrollment and
how they learned about about the drug program
 Attitudes toward drug coverage and enrollment over time
 Sequential behaviors (e.g., talking with others, reading drug
plan materials, comparing plans, etc.) regarding enrollment
decision making
 Predicted future behaviors regarding enrollment (i.e, what
are perceived next steps among those planning to enroll?;
how will “undecided” make a decision?; among those not
planning to enroll, do they perceive anything that might
change their mind?)
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Preliminary Observations -1

Observations from the Interviews

Beneficiaries had access to information from the news
and from prescription drug plans – often lots

Beneficiaries also read marketing materials from drug
plans – and seemed to have access to/read this more
than materials from Medicare

There was heavy reliance on the AARP as an information
source
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Beneficiary Comments - 2
“What is a formulary? …This is one of the most frustrating
experiences I’ve ever had. I think about those who are less
educated and not as well read as I am. It is a
nightmare.”….“I feel that I’ve hit a lot of dead ends. I am
highly frustrated about receiving information.”
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Preliminary Observations – 2

Observations from the Interviews
 Having someone who was able to assist appeared to be
very important
 Family and friends appeared to play a larger role than
doctors and pharmacists
 Beneficiaries were not particularly worried about paying
for prescription drugs, even if they currently took
medications
 Most were aware of the May 15th deadline for enrollment
and many were aware of a penalty for not joining by that
time
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Beneficiary Comments - 3
“There’s so much reading to do.”
Looking into drug plans involved “a ton of research.”
“I’m going to have to narrow it down. It’s not too
hard to pick out a program that’ll fit you now but I
got to be careful that that program can be expanded
b/c you don’t know what you’ll be on.”
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Statistical Results - 1

Aspects of the qualitative interviews were coded.
We have coded whether:

the beneficiary was predisposed to joining a PDP or not,

the actions they took to gather information, the intensity of
those actions, how they enrolled (self or other)

motivators to join

demographics
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Preliminary Findings on Beneficiaries
Predisposed to Joining
Compared with others, those who recall being likely to join when
they first learned about Medicare prescription drug coverage
were:
 More likely to read information from drug plans
 More likely to call various drug plans for information
 More likely to call Medicare
 More likely to have someone help them compare
costs/formularies
 More likely to view drug coverage as insurance against high
costs; cost savings
 More likely to report losing an insurance/discount program
they currently have
 More likely to ultimately enroll
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Beneficiary Comments - 4
On the enrollment penalty
“I almost feel that I have to. They say if you don’t sign up
now, before May, you will be penalized…It’s a scary thing. It
bothers me.”
[If there is a penalty] “I guess I will enroll and pay
accordingly”.
“…there’s a lot of pressure from everything you read, the
penalty hanging over your head…[the message that] you
really ought to do this because ‘you never know.’”
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Next Steps

Investigate relationships between decision making styles
(i.e., satisficer and maximizer) and enrollment behaviors

Perform cluster analysis

Future decision making – who does what next year

Impact of health status, prescription drug need, and worry on
decision making
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Questions/Comments?
Contact: Beth Simon, CMS (410) 786-0006
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