How Medicare Advantage Plans Can Increase Consumer Satisfaction

Medicare Advantage plans are more likely to achieve high satisfaction scores when they offer a consistent product message and brand experience and have control over the delivery of care, according to a J.D. Power study. Members frequently choose a plan they understand and find easy to work with. The study measures member satisfaction with Medicare Advantage plans based on six factors in order of importance: coverage and benefits (26%); customer service (20%); provider choice (15%); cost (14%); information and communication (13%); and claims processing (13%).

Improving communications with enrollees is one of the greatest opportunities for health plans to improve member satisfaction. It’s the only factor in the study that has not seen a significant improvement in member satisfaction. Valerie Monet, director of the insurance practice at J.D. Power, said that many plans have multiple product design features and come with technical manuals that are 20 pages or longer. Expecting members to be experts on these services and benefits is a losing battle for the plan and the member. Members expect their plan to provide guidance, ranging from assistance in selecting a doctor to helping them understand prescription costs.

Forty-eight percent of members agree strongly that their health plan is a trusted partner in their health and wellness, which increases satisfaction by 166 points. Satisfaction is 136 points higher among the 89% of members who completely understand how to find a doctor under the plan. Satisfaction is 110 points higher among the 88% of members who say their doctor spends the right amount of time with them.

Members expect immediate attention or advice when they call their health plan provider. Forty-one percent of those who called their plan had to give the same information more than once to get their issue resolved. Only 35% of members said that customer service provided all of the information they needed on the costs of prescription medications. Ninety-one percent of customers who are delighted with their Medicare Advantage plan (satisfaction scores of 901 or higher), say they will definitely renew their policy, and 89% will definitely recommend their plan to family and friends. Loyalty drops to 71% and advocacy to 66% among members who are pleased with their plan (scores of 751-900). Plans garnered the following member-satisfaction scores:

  • Kaiser Permanente 851
  • Highmark 791
  • Humana 782
  • UnitedHealthcare 775
  • Cigna 774
  • Aetna 773
  • Anthem 765
  • Health Net 756
  • WellCare 742

In 2016, members reported an average increase of $117 in annual premiums to $1,497. They also have more out-of-pocket expenses. On average, member deductibles are $1,705 in 2016, a $310 jump from 2015. Satisfaction is 136 points higher when members completely understand their out-of-pocket costs. Monet said that members are more satisfied and see the value of their plan when they have a better understanding of how much they are paying and what the costs cover.” For more information visit http://www.jdpower.com/resource/us-medicare-advantage-study.

Health Plan Offer Rates Since the ACA

A study by the Employee Benefits Research Institute (EBRI) reveals that large employers have had steady health insurance offer rates since passage of the ACA. In fact, 99% of employers with 1,000 or more workers offer heath insurance as do 93% to 95% of employers with 100 to 999 workers. However, offer rates have been falling since 2009 for employers with fewer than 10 workers, from 36% in 2008 to 23% in 2015. Offer rates for employers with 10 to 24 workers went from 66% in 2008 to 49% in 2015. Offer rates for employers with 25 to 99 workers went from 81% in 2008 to 74% in 2015.

Consumer-Driven Health Plans Gain Ground

Thirteen percent of the privately insured U.S. population was enrolled in a consumer-driven health plan (CDHP) in 2015, according to a report by the Employee Benefits Research Institute. Sixty-three percent of those enrolled in CDHPs had an HSA; 13% had an HRA, and 24% had the option of an HSA-eligible health plan, but had not opened an HSA.

Covered California Rates Jump 13% in 2017

Covered California Rising costs

Covered California’s premiums jumped 13.2% for 2017, up from about a 4% increase in each of the past two years. However, most consumers will see a much smaller increase or pay less next year if they switch to another plan. California executive director Peter Lee said, “Shopping will be more important this year…Almost 80% of our consumers will be able to pay less than they are paying now, or see their rates go up by no more than 5% if they shop and buy the lowest-cost plan at their same benefit level.”

While premiums will rise, the subsidies will rise as well. About 90% of Covered California enrollees get help to pay for their premiums. The average subsidy covers roughly 77% of the consumer’s monthly premium. “Even though the average rate increase is larger this year than the Past two years, the three-year average increase is 7% – substantially better than rate trends before the Affordable Care Act was enacted,” Lee said.

Covered CaliforniaPremium increases 2014-2015 2015-2016 2016-2017 3-year average
Average weighted increase 4.2% 4% 13.2% 7%
Lowest price Bronze plan 4.4% 3.3% 3.9% 3.9%
Lowest priced Silver plan 4.8% 1.5% 8.1% 4.8%
Second lowest priced Silver plan 2.6% 1.8% 8.1% 4.1%
If a consumer switches to the lowest priced plan in the same tier -4.5% -1.2%

 

Lee said the average rate increase reflects the following factors:

  • A one-year adjustment due to the end of the reinsurance funding mechanism in the Affordable Care Act. The provision was designed to moderate rate increases during the first three years when exchanges were being established. The American Academy of Actuaries estimates that this will add 4% to 7% to premiums for 2017.
  • Special enrollment by some consumers who sign up only after they become sick or need care, which has had a significant effect on rates for two insurance plans.
  • The rising cost of health care, especially for specialty drugs.
  • Pent-up demand for health care among those who were uninsured before the Affordable Care Act.

Lee said, “Covered California is working to address some of these issues on multiple fronts. The exchange is aggressively marketing to attract healthy consumers year-round, and is working to ensure special enrollment is available only to those who meet qualifying circumstances. It is also sampling the special enrollment population to better understand how to make any further improvements needed.”

Covered California is reducing the number of services that are subject to a consumer’s deductible. Starting in 2017, consumers in Silver 70 plans will save as much as $55 on an urgent care visit and $10 on a primary care visit. Consumers in Silver, Gold, and Platinum plans will pay a flat copay for emergency room visits without having to satisfy a deductible, which could save them thousands of dollars.

These improvements build on features already in place that ensure most outpatient services in Silver, Gold and Platinum plans are not subject to a deductible, including primary care visits, specialist visits, lab tests, X-rays and imaging. Some Enhanced Silver plans have little or no deductible and very low copays, such as $3 for an office visit. Consumers in Covered California’s most affordable Bronze plans can see their doctor or a specialist three times before the visits are subject to the deductible.

The contract with health insurers for 2017 ensures that consumers select or are provisionally assigned a primary care physician. Below are the companies selected for the 2017 exchange:

  • Anthem Blue Cross of California
  • Molina Healthcare
  • Blue Shield of California
  • Oscar Health Plan of California
  • Chinese Community Health Plan
  • Sharp Health Plan
  • Health Net
  • Valley Health Plan
  • Kaiser Permanente
  • Western Health Advantage
  • A. Care Health Plan

The following carriers are increasing their coverage areas in 2017:

  • Oscar will be entering the market in San Francisco, Santa Clara, and San Mateo counties.
  • Molina will expand into Orange County.
  • Kaiser will be available in Santa Cruz County.

With the expansion of carriers, 93% of consumers will be able to choose from three or more carriers, and all will have at least two to select from. In addition, more than 93% of hospitals in California will be available through at least one Covered California health insurance company in 2017, and 74% will be available in three or more plans. Rate details by pricing regions can be found in Covered California’s Health Insurance Companies and Plan Rates for 2017, posted online at: http://coveredca.com/news/pdfs/CoveredCA-2017-rate-booklet.pdf.

Manufacturing Leads Adoption of High-Deductible Health Plans

Manufacturing

A survey by Benefitfocus reveals distinct differences in benefit offerings among manufacturing, education, and health care industries. Manufacturing leads the adoption of high-deductible health plans (HDHPs), education favors traditional plans (PPOs, HMOs, etc.) and the health care industry offers the most voluntary benefits. Manufacturing is the only industry of the three, in which more companies offer a combination of HDHPs with traditional plans than traditional plans only (48% to 46%). Manufacturing employees selected an HDHP over a traditional plan 46% of the time. The findings suggest that manufacturing employers have an opportunity to encourage employees to participate in health savings accounts (HSAs) or flexible spending accounts (FSAs) to cover higher out-of-pocket costs associated with HDHPs. Only 23% of education employers offer at least one HDHP. Traditional health plans dominate the mix of benefits. HMOs made up 44% of employee enrollments, which suggests an opportunity to offer a wider range of lower cost benefit options for a multi-generational workforce.

Employees in the health care industry face high deductibles regardless of plan selection, but are better equipped to cover unexpected medical costs with voluntary benefits (including critical illness, accident, and hospital-indemnity insurance). Health care employers offered gap products at the highest rate of the three industries at 12 percentage points above the average. Nearly half of health care workers selected a voluntary plan when given the choice.

Patients Are Paying More, But Health Plans Are Not

LifeInsuranceSales

From 2004 to 2014, patient cost-sharing rose much faster than payments that health plans made for care, according to a report by the Kaiser Family Foundation. Deductibles and coinsurance rose considerably faster than the cost for covered benefits. Average payments toward deductibles still account for a relatively small share of total household budgets, they have been increasing rapidly.

Health care spending has grown fairly modestly in recent years. But, while out-of-pocket costs are growing, wages are remaining largely stagnant. Patients in large employer plans are paying more out-of-pocket. Deductibles are the most visible element of an insurance plan, which may help explain why consumers are showing concern about their out-of-pocket costs. The report reveals the following averages from 2004 to 2014:

  • Patient cost-sharing rose 77%, from $422 to $747.
  • Deductibles accounted for 24% of cost sharing in 2004 and 47% in 2014.
  • Enrollees saw a 256% increase in average deductibles from $99 to $353.
  • Coinsurance payments rose 107%, from $117 to $242.
  • Copays fell 26%, from $206 to $152. Copayments accounted for nearly half of the cost sharing payments in 2004, falling to 20% in 2014.
  • Payments by health plans rose 58%, from $2,748 to $4,354. Large employer plans covered 87% of covered medical expenses in 2004 and 85% in 2014.
  • Workers’ wages rose 32% from 2004 to 2014.

The increase in coinsurance may reflect the strong growth in plans that qualify a person to establish a health savings account; these plans are more likely to have coinsurance than copayments for physician services. Patients are more sensitive to the price of health care with deductibles and coinsurance than they are with copays, which are flat dollar amounts. Also, copays may add up over time while a deductible may need to be met at once, causing affordability challenges

The Costs of Caring for Newly Enrolled Individual Members

Individuals who enrolled in Blue Cross and Blue Shield (BCBS) health plans after the Affordable Care Act (ACA) took effect have higher rates of disease. They also received much more medical care than did those who enrolled in individual plans before 2014. The study finds the following:

  • Members who were newly enrolled in BCBS individual health plans in 2014 and 2015 had higher rates of certain diseases, such as hypertension, diabetes, depression, coronary artery disease, HIV, and Hepatitis C.
  • New enrollees received much more medical care than did those with BCBS individual plans before 2014 who maintained BCBS individual health coverage into 2015, as well as those with BCBS employer-based group health insurance.
  • New enrollees used more medical services including inpatient admissions, outpatient visits, medical professional services, prescriptions filled, and emergency room visits.
  • Medical costs of care for the new individual market members were 19% higher than employer-based group members in 2014 and 22% higher in 2015. For example, the average monthly medical spending per member was $559 for individual enrollees versus $457 for group members in 2015.

Alissa Fox, senior vice president of the office of policy and representation for BCBSA said, “Better communication and coordination is needed so that everyone understands how to avoid unnecessary emergency room visits, make full use of primary care and preventive services, and learn how to properly adhere to their medications.” BCBS companies are expanding prevention, wellness, and coordinated care programs. Fox said that these programs have helped BCBS companies reduce emergency room visits, hospital admissions and readmissions, and hospital infection rates. There have been measurable improvements in prevention, including improved cholesterol control, better adherence to best practices for treating diabetes, and higher rates of screenings and immunizations.

High-Deductible Health Plans Don’t Actually Increase Consumerism

HighDeductible2

High-deductible health plans (HDHPs) are associated with lower health care spending, but not because consumers are shopping around for healthcare, according to a study published in the Journal of the American Medical Assn. (JAMA). Health insurance claims data indicates that these savings are due primarily to decreased use of care, and not because HDHP enrollees are switching to lower-cost providers. Enrollees in HDHPs are no more likely than those in traditional plans to consider switching their health care provider or comparing out-of-pocket cost among health care providers.

Researchers surveyed a nationally representative sample of insured adults from 18 to 64 who used medical care in the past year. They compared enrollees in HDHPs  with those in traditional plans on how much they shopped for care. The study found the following:

  • High-deductible health plan enrollment is higher among whites, those employed, those with more education, and those with higher incomes.
  • 60% of HDHP enrollees say there are large differences in prices and quality among health care providers.
  • 17% say that higher price physicians provide better care.
  • 71% say that out-of-pocket costs are important when choosing a doctor. These perceptions are not significantly different from those in traditional plans. HDHP enrollees are less likely to say that higher price facilities provide better care. They are more likely to say that out-of-pocket costs are important in choice of radiology facility.
  • 56% of HDHP enrollees say they would use additional sources of health care price information if available.

To encourage price shopping, consumers need more price information. Also, the market needs innovative approaches to get enrollees to take advantage of pricing information, according to researchers.

Survey: People with consumer-driven health plans do more price comparisons

People who have consumer-driven or high-deductible health plans are more likely to ask whether care is covered, seek out generic drugs and talk to their doctors about less-costly care options, according to a survey. The report notes that such plans were designed to steer consumers to more cost efficient care, but “the ability to make informed decisions is highly dependent on the extent to which people have access to useful information.” ThinkAdvisor (1/13)

A Snapshot of Consumer-Driven Health Plans

A recent survey by EBRI and Greenwald & Associates finds the following about consumer driven health plans (CDHPs):

  • 13% of the privately insured population are enrolled in a CDHP; 11% are enrolled in a high-deductible health plan (HDHP); and 76% are enrolled in more traditional coverage.
  • 26 million people with private insurance are enrolled in a CDHP—a health plan associated with a health savings account (HSA) or health reimbursement arrangement (HRA), or an HSA-eligible health plan.
  • 63% of people in CDHPs have opened an HSA, 13% are in an HRA, and 24% are in an HSA-eligible health plan, but have not opened an HSA.
  • People in a CDHP or an HDHP are more likely to have cost-conscious behaviors compared to those in traditional plans. They are more likely to have checked whether the plan would cover care; asked for a generic drug; talked to their doctors about prescription options and costs; asked a doctor to recommend a less costly drug; talked to their doctors about other treatment options and costs; developed a budget to manage health care expenses; and used an online cost-tracking tool provided by the health plan.
  • People in a CDHP are more likely to have talked to friends, family, or colleagues about the plans; attended a meeting where health plan choices were explained; and consulted with their employer’s HR staff about health plan choices.
  • People in an HDHP are more likely to have visited the health plan’s website to learn about their plans; talked to friends, family, or colleagues about the plans; used other websites to learn about their choices; and consulted with an insurance broker to understand their plan choices.
  • CDHP enrollees are more likely to take advantage of wellness programs, such as health-risk assessments, and health-promotion programs, and biometric screenings.
  • Financial incentives mattered more to CDHP enrollees than to traditional-plan enrollees.

Last Updated 10/14/2020

Arch Apple Financial Services | Individual & Family Health Plans, Affordable Care California, Group Medical Insurance, California Health Insurance Exchange Marketplace, Medicare Supplements, HMO & PPO Health Care Plans, Long Term Care & Disability Insurance, Life Insurance, Dental Insurance, Vision Insurance, Employee Benefits, Affordable Care Act Assistance, Health Benefits Exchange, Buy Health Insurance, Health Care Reform Plans, Insurance Agency, Westminster, Costa Mesa, Huntington Beach, Fountain Valley, Irvine, Santa Ana, Tustin, Aliso Viejo, Laguna Hills, Laguna Beach, Laguna Woods, Long Beach, Orange, Tustin Foothills, Seal Beach, Anaheim, Newport Beach, Yorba Linda, Placentia, Brea, La Habra, Orange County CA

12312 Pentagon Street - Garden Grove, CA 92841-3327 - Tel: 714.638.0853 - 800.731.2590
Email:
Jay@ArchApple.com
Copyright @ 2015 - Website Design and Search Engine Optimization by Blitz Mogul