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THEIMPACTOFREPORTCARDSONEMPLOYEES: ANATURALEXPERIMENT THEIMPACTOFREPORTCARDSONEMPLOYEES: ANATURALEXPERIMENT byDavidJ.Knutson,PrincipalInvestigator JinnetB.Fowles,PhD SusanAdlis,MS ElizabethA.Kind,MS,RN MichaelFinch,PhD JeanneMcGee,PhD NanetteL.Dahms,MSW FederalProjectOfficer: SherryTerrell,PhD HealthResearchCenter InstituteforResearchandEducation HealthSystemMinnesota HCFAGrantNo.18-P-90601/5 August1997 Thestatementscontainedinthisreportaresolelythoseoftheauthorsanddonotnecessarilyreflect theviewsorpoliciesoftheHealthCareFinancingAdministration. Thegranteeassumes responsibilityfortheaccuracyandcompletenessoftheinformationcontainedinthisreport. ACKNOWLEDGMENTS Wewouldliketoacknowledgethecontributionsofanumberofindividualswhogaveus valuableassistanceandadvice. Theyare,fromtheInstituteforResearchandEducation,Mary Kvanbeck,whocreatedoursamplesanddevelopedourdatabaseforanalysis,JayneHoese,who administeredboththeproposalandgrant,andBeverlyGray,whoformattedandproofedthesurvey instrument. FromtheMinnesotaDepartmentofEmployeeRelations,weacknowledgeLettieSagisser andfromtheUniversityofMinnesota,RobertFahnhorst,BrendaByron,andBettyGilchristwho developedtheemployeeadministrativedatabasesforsamplingandanalysis. KathleenBurek,DepartmentofEmployeeRelations,extendedthesupportofthestateof Minnesotatothisproject. WethankSherryTerrell,PhD,ourHCFAprojectofficer,whoprovidedvaluableadvice andcommentthroughouttheproject. Finally,wethanktheemployeesofthestateofMinnesotaandtheUniversityofMinnesota whoagreedtobeinterviewed. Withoutthemwewouldnothavehadastudyonwhichtoreport. 111 CONTENTS ExecutiveSummary 1 Introduction 3 Background 3 SummaryofSelectedLiterature 4 KnowledgeofHealthInsuranceCoverage 4 SourcesofInformationaboutHealthCareDecisions 5 ConsumerChoiceofHealthPlan 5 EffectsofHealthPlanReportsonConsumers 6 LimitationsintheExistingLiterature 6 StiidySetting 7 HistoryandOperationsoftheSEGIP 7 TheAnnualOpenEnrollmentProcess -....8 UseofHealthPlanReportCards 8 Methods 1 StudyDesign 1 Eligibility 1 SampleSizeandResponseRate 12 Analysis 12 Discussion 15 KnowledgeaboutHealthPlanBenefits 15 EffectofReportCardsonEmployees'KnowledgeofPlanBenefits 15 EffectofReportCardsonEmployees'PerceivedKnowledgeofPlans 20 AttitudesaboutHealthPlans 22 StatedPreferencesforQualityversusCost 22 EffectofReportCardsonEmployeeRatingsoftheQualityofAvailablePlans..25 ChoosingHealthPlans 27 EffectofReportCardsontheRateofSwitchingPlans 27 ReasonsforSelecting1996HealthPlan 28 QualityReasonsforSwitching 30 WillingnesstoIncurPremiumContributions 30 InformationSeeking 32 Conclusion 35 CharacteristicsofSetting 35 CharacteristicsofthePopulation 36 Measures 36 CharacteristicsoftheDesignandData 36 NatureofQualityinMemberSatisfection-BasedReportCards 36 UnitofAttribution 37 ClosingThoughts 37 References 39 iii 711 Appendixes A. Glossary A-1 B. SampleFlowChart B-1 C. Pre-enrollmentQuestionnaire C- D. PostenrollmentQuestionnaire D-1 E. ItemTracker E-1 F. Respondents'HealthPlanEnrolhnent,1995and1996 F-1 G. HCFAReviewPaper G-1 H. 1995DOERReportCard H- ListofTextTables A. StudyDesign 11 B. CorrectAnswerstoKnowledgeQuestions 16 C. Employees'AbsoluteKnowledgeofBenefitsatPostenrollment .:..1 D. ClassificationofChangeinEmployees'Knowledge 18 E. ChangeinEmployees'KnowledgeofBenefits,Pre-enrollmenttoPostenrollment 19 F. Employees'PerceivedKnowledgeatPostenrollment 20 G. ChangeinEmployees'PerceivedKnowledge,Pre-enrollmenttoPostenrollment 21 H. PreferencesforQualityandCostAttributesatPostenrolhnent 23 J. ChangeinPreferencesforQualityandCostAttributes,Pre-enrollmenttoPostenrollment 24 K. EmployeeRatingsoftheQualityoftheirOwnandOtherHealthPlans 26 L. EmployeesWhoSwitchedandDidNotSwitchPlansin1996 28 M. ReasonsforSelecting1996HealthPlan 29 N. StateandUniversityEmployee'sAnnualPremiumContributions 31 0. ArmualAveragePremiumContribution 32 ListofDetailedTables I. ItemFrequencies T-1 2. IndependentVariables T-2 3. DependentVariables T-3 4. Respondents'HealthPlanEnrolhnent,1995and1996 T-4 iv EXECUnVESUMMARY Supportersofmanagedcompetitionapproachestohealthcarehavestressedtheimportanceof providingconsumerswithuseflilinformationtomakechoicesamonghealthplansduringopen enrollmentperiods. Littleisknown,however,abouttheimpactofreportcardsontheknowledgeof consumersabouthealthplans,theirattitudestowardsplans,ortheirchoiceofplans. Thisstudytakesadvantageofanaturalexperimenttoaddressthefollowingquestions: • Doconsumerreportcardsimproveconsumers'knowledgeabouthealthplans? • Doconsumerreportcardsaffectconsumers'attitudesregardingtheproblemofselectingahealth plan? • Doconsumerreportcardsinfluenceconsumers'evaluationofhealthplansandchoiceofhealth plans? Thestudyalsoaddresses\diethertheanswerstotheseresearchquestionsdependonthe characteristicsofindividualconsumersandhouseholds. Toanswerthesequestions,wetookadvantageofanaturalexperimentandcomparedseveral difiFerentsamplesofemployeesfromtheStateofMinnesotaEmployeeGroupInsuranceProgram (SEGIP).TheSEGIPdisseminatedreportcardsbasedonconsumersurveyscomparinghealthplansto itsemployeesduringtheopenenrollmentseasonsin1991,1993,and1995. Onegroupofemployeesin theSEGIP,theUniversityofMinnesota,didnotreceivethereportcards,althoughtheyotherwise participatedinthesamehealthplanenrollmentprocessandhadthesamechoiceofplansandthesame premiums.Thisgroupservedasourcontrolgroup. Weanalyzedprimarydatathatwerecollectedthroughtelephonesurveysofstateemployees. Pre-enroUmentandpostenrollmentsurveyswereconductedimmediatelybeforeandafterthe1995open enrollmentperiods. Wehypothesizedthatthereportcardwould: • improveemployeeknowledgeofhealthplans,inpartbyincreasingconsumers'attentionto objectiveplanattributessuchasbenefits; • increasetheimportanceofqualityinrelationtocostandconvenience; • influencetherespondents'opinionsoftheoverallqualityoftheplansdescribedinthereport card; • influencetherateofswitchingplans; • influencethereportedreasonsofrespondentsforselectingtheir1996plan,whetherremaining withtheir1995planorswitchingtoanotherplan;and • influenceemployees'willingnesstopaythemarginalpremiumforhigherpricedhealthplans. Wefoundnoneoftheseeffects. Wedidfindthatanumberofenrolleeandhealthplancharacteristicswerestronglyrelated tohealthplanknowledge,attitudeandchoice. Thesefindingswere,forthemostpart,consistent withfindingsreportedfromotherresearchondeterminantsofhealthplanchoicebyconsumers. 1 Ourfindingssuggestthatthecurrentversionsofhealthplanreportcardsareworksinprogress. Asmuchsalienceashealthplanmembersatisfectionreportsappeartohave,consumersdonotseemto beinfluencedbytheinformationinanyofthewaysmeasuredinthisstudy. Wesuggestanumberofpossiblereasonsfornotfindingreportcardeffects.Theseinclude limitationsofthestudyandquestionsabouttheimportanceofandmeaningtoconsumersofthecontent oftypicalmembersatisfectionbasedreportcards. 2