Reprinted with AIS Health permission from the May 21, 2020, issue of RADAR on Medicare Advantage.
Despite the acceleration of U.S. COVID-19 cases in March — the third and final month of the Medicare Open Enrollment Period — switching rates among Medicare Advantage beneficiaries during the 2020 OEP were similar to last year’s at 5%, according to new survey results from Deft Research. But with CMS extending certain enrollment flexibilities and the pandemic’s potential impact on in-person interactions, industry experts advise MA plans to have a strong communications strategy in place with existing members while preparing for a more digitally based Annual Election Period (AEP) than the industry has ever seen.
The three-month OEP, reinstated in 2019 after a long hiatus, is available only to MA enrollees who want to make a one-time coverage change from what they selected during the AEP. Its return created enough uncertainty among insurers that “carriers and agencies took it seriously” in their responses both this year and last, observed Deft’s senior vice president of client services, George Dippel, in an executive brief released earlier this month on the firm’s 2020 Medicare Open Enrollment Study.
According to the study, 86% of survey respondents did not shop during this recent OEP and 8% shopped but did not switch, compared with 88% who did not shop and 6% who shopped without making a switch last year. But while the 2020 OEP saw slightly more shoppers, it saw the same rate (5%) of switchers: 2% who switched insurers and 3% who switched plans but kept their insurers. Like last year, only 1% of survey respondents abandoned their MA plan for Original Medicare.
The study is a survey of more than 3,700 Medicare-eligible consumers, many of whom were surveyed in Deft’s previous report on the 10-week AEP that saw a much higher rate of switching at 13%. Nevertheless, “the impact of 5% switching is nothing to look down one’s nose upon,” and it may not always be the case that a plan’s AEP growth trajectory will be mirrored during the OEP, wrote Dippel. The 2020 OEP study looked at many potential factors that can impact consumer behavior, such as welcome calls, welcome packets, supplemental benefits, premiums and network changes.
But not all enrollees who wanted to make a change may have been able to do so because of the COVID-19 pandemic, and CMS in a recent memo extended a Special Enrollment Period (SEP) to such individuals through June. Furthermore, the agency in a separate posting said it would give certain beneficiaries extra time to enroll in Part B or decline automatic Part B enrollment and avoid a late enrollment penalty.
Extension Could Create Enrollment ‘Blip’
Since many Social Security Administration offices have been closed due to states’ stay-at-home orders, “people who were in a SEP likely could not apply for Part B,” points out Tim Brousseau, Deft’s vice president of client services, in an email to AIS Health. “This extension might lead to a blip in enrollment, but a bigger driver might be those people who expected to delay their enrollment into Medicare and work past their IEP [Initial Enrollment Period], but now they might no longer have a job and be forced into Medicare.”
Diane Hollie, vice president of sales and strategy with Gorman Health Group (GHG), says the additional time to make a switch isn’t leading her MA clients to alter their general marketing and communications strategies. That’s because so much of their communications, both to the public and to their members, have been focused on COVID-19, and they don’t have the time to focus on an SEP. “They don’t feel that they’re going to lose people during this time because it’s a scary time, and they don’t feel a lot of people will be switching unless they’re very unhappy because typically when people are concerned about something, they’re going to stay with what they have and what they feel comfortable with.”
Plans Hear From Aging-in Campaigns
Meanwhile, GHG has observed an increase in the response to MA plans’ “aging-in” campaigns for new-to-Medicare beneficiaries. “We wanted to get a feel for [whether] people are paying attention to things other than COVID-19. And yes, they are,” says Hollie. From the conversations the consulting firm has had with several clients, “it looks like people are staying home and are starting to either read their mail [or] do their research online and respond. And we’re starting to see more responses go toward…asking for more information,” she tells AIS Health.
Having a strong communication strategy during an uncertain time and providing members with helpful information to get them through it may position insurers for a strong AEP, she suggests. At the same time, it allows them to “test out their systems,” offering things like virtual town halls and Medicare 101 seminars, and “work out the kinks on all of this before AEP comes around, because we anticipate that” it’s going to be more of a digitally based experience, observes Hollie. “What we’re seeing is that those who have their act together are testing all of this out now, so it’s not new come September.”
The COVID-19 pandemic will radically alter the way Medicare beneficiaries shop this fall, agrees Cary Badger, a principal with HealthScape Advisors. But it may be hard to predict consumer behavior across conflicting patterns, he suggests. Both GHG and HealthScape are part of the Convey Health Solutions family of companies.
MAOs Should Still Expect Active Shopping
“On the impact of COVID, all bets are off, because it’s unprecedented the way that people may be reacting to this,” says Badger. “We’re coming off strong consumer purchasing behavior [in the 2020 AEP], and going into the next AEP there’s going to be a lot of uncertainty economically, not just post-COVID — which creates one set of behavior around security and peace of mind — but layered on top of that is probably a very insecure economy and a presidential election. So there’s a lot of change. When there’s a lot of change, seniors in my experience don’t like disruption.”
That said, Badger says plans can expect to see some active shopping and switching in the fall and a major shift to online digital shopping channels such as “online plan aggregators” like eHealth or HPOne. “In Medicare sales, they represent a substantial part of market activity, and now seniors are very comfortable with [finding] plans and getting activated on the web,” observes Badger. As a result, carriers should “evaluate and increase strategic engagement” of aggregators while investing in innovative technology to support contracted agents to generate leads and sell across digital and phone channels, as well as in “highly effective digital and call center direct sales to mitigate commission costs and replace traditional channels.”
At the same time, plans should seek new ways to engage family and friends as navigators for those beneficiaries who cannot easily shop online. “Typically, those who shop for health insurance are the younger bracket of the seniors, being 65 to 75, [while] people over 75 rely more on family members and caregivers who are looking at options for them,” says Badger.
Finally, once their choice has been made, the ability to “validate the offer” and assure people they chose your plan for the right reason will be critical going into the 2021 OEP, he adds. “Boomers like immediate satisfaction. They like to know they got what they bought, so [it’s finding ways] plans can support and engage consumers in ways they’ve never really had to do in the past.”
By Lauren Flynn Kelly