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Money / Your Medicare Advisor

AARP Branded Medicare Advantage Plans Do Not Rank Among the Best Scorers

 

The Affordable Care Act (“ACA” aka “Obamacare”) will bring new opportunities and challenges to health care consumers. With more people receiving coverage on the individual market, they will need to find ways to select health plans that meet their needs. Consumerism in the Medicare market predates Obamacare with choices of Medicare Advantage and Medicare Prescription Drug plans. In light of the movement toward individual choice, HealthPocket decided to look at the effect of brand awareness on decision making and focused on one well known and widely used branded Medicare Advantage program. We found that plans bearing the AARP brand in the Medicare Advantage market on average fall short of the industry in two measures of plan quality.

This report looked at 578 Medicare Advantage contracts with a particular focus on the government’s star rating and the overall opinion of the plan based on a survey of enrollees in that plan. The goal of this research is to compare how one of the strongest brands in the industry, AARP and its endorsed carrier, UnitedHealth, perform in these high level quality metrics compared with the universe of plans.

The Medicare Advantage program has been successful in many ways, including enrollment. There are now 14.4 million people enrolled in Medicare Advantage plans, and that figure has grown by almost 10 percent since 2012.1 Medicare Advantage market share represents over 28 percent of the Medicare eligible population.2 By contrast, the insurance industry reports that 10.2 million people had Medigap plans, which supplement benefits to traditional Medicare, at the end of 2012. This marketplace doesn’t show the same growth pattern seen in the Advantage market.3

Consumers have complex choices to make when deciding between traditional Medicare and Medicare Advantage. Once they conclude that an Advantage plan can best meet their needs, they then have to navigate an array of options available to them. There is much research regarding the paradox of choice and consumer decision making generally.4 One specific study of the Medicare Advantage market showed the market within a particular region generally grows when choice is limited to fewer than 15 plans, but could in fact shrink if choices become too numerous.5 The article expressed particular concern that beneficiaries with cognitive challenges could miss better plan opportunities because of having too much choice.

The Medicare plan quality star rating system is a key factor in helping enrollees differentiate plans. The rating provides a one to five (actual results start at 2 stars) scoring system for Medicare Advantage Plans.6 The overall rating reflects treatment, preventive care, and customer satisfaction collected on the Medicare Advantage plan. Consumers who are interested in poring through more detail can find sub-ratings on the Medicare plan finder website7 and on HealthPocket’s Plan Details page for each Medicare Advantage plan.8

Researchers are finding evidence that the star ratings are beginning to move market share toward the higher rated plans.9 However, HealthPocket also wanted to see the effect a brand might have on Medicare Advantage market share. Because choices can be so numerous in the Medicare Advantage market, a consumer might fall back on a basic comfort level that a known and trusted brand can provide a good choice. Research also indicates that some older people select from among fewer choices based on brand awareness.10

Background

UnitedHealth is the leading market share carrier for Medicare Advantage, with a reported market share of nearly 21 percent in February 2013.11 Humana has the second largest market share at nearly 17 percent. AARP branded plans are described on the AARP Member Advantages website12 as being structured the following way: “The AARP® MedicareComplete® plans are insured through UnitedHealthcare Insurance Company and its affiliated companies, a Medicare Advantage organization with a Medicare contract. UnitedHealthcare Insurance Company pays royalty fees to AARP for use of its intellectual property.”

Market share reports do not tend to break out AARP’s share from the rest of UnitedHealth’s, but a Congressional report in March 2011 stated that AARP branded plans then had an 11 percent market share and non-AARP branded UnitedHealth plans had an additional 7 percent market share.13

Star Ratings

The chart below compares the average star ratings for AARP Medicare Advantage plan contracts with the remaining universe of Medicare plan contracts: The data shows a significant oversupply of AARP contracts in the 3 and 3.5 range, while few AARP contracts reach 4 and none reach the excellent range of 4.5 and 5. In fact, only 8.5% of AARP plan contracts exceed 3.5 stars. Averaging all contracts with ratings excluding AARP, the average score equaled 3.47, while the average for the AARP contracts equaled 3.27.

The highest scoring plans across their average contract scores were nonprofit health plans, including Kaiser (7.9 percent market share, but still an average contract score of 4.93), Gundersen Lutheran Health System, Baystate Health and HealthPartners Inc.) However, for profit plans also had higher average contract scores than AARP, such as Humana (3.4) and Aetna (3.65.)

Members’ Overall Rating of Plan Results

HealthPocket also looked at how the branded AARP Medicare Advantage plans fared compared with the industry in how the plans were rated by a survey of their members. The chart below shows how the AARP plans compared with the remainder of the plans in the industry with respect to members who rated the plan highly.

The industry average for all plans excluding AARP for this response was 86 percent of members rated the plan highly, while AARP’s plan contract average was 83 percent. Perhaps more importantly, the AARP plans top out at 86 percent, while the rest of the industry has 62 plan contracts at 90 percent or higher and tops out at 95 percent.

Implications for Consumers

A lot of factors drive consumers’ decisions regarding their health plan purchase. They will be heavily motivated by cost, including premiums, copays, deductibles and maximum out-of-pocket expenses. Many will want to make sure that key physicians participate in their plan and that specific health care facilities are in a plan’s network. Therefore, quality should play one important role in a mix that contains other factors. At least with respect to Medicare Advantage quality scores and consumer satisfaction data, the AARP branded plans are not top performers. Yet they are successful in achieving strong market participation. Fortunately for consumers CMS, the Medicare plans’ regulator, has done an excellent job of releasing data to the public and on its own plan finder website. This allows easier comparison of plans and brings plan quality into the mix for consumer decision making. Being able to see actual ratings and customer satisfaction might provide enrollees sufficient peace of mind to look beyond the brand in determining health plan selection.

METHODOLOGY

Data on attrition, complaints and star ratings were taken from 2013 CMS Medicare Part C Performance Data tabulations.14 The data was based on contract numbers, which can represent multiple plans. UnitedHealth contract numbers were compared against Medicare Advantage plan landscape data to determine which UnitedHealth plans carried the AARP brand. Medicare Advantage contract plans that were either too new or had insufficient data to a have star rating or overall plan rating were eliminated from this review. The remaining plans were not adjusted for market share.15 This study did not consider premium costs or other plan details. All analysis assumes the accuracy of the underlying government data. While every effort was made towards a representative collection of plans, HealthPocket makes no representation that every plan within the Medicare Advantage market was included in this study. Percentages are rounded according to standard industry practices.

AUTHOR

Steve Zaleznick, Executive Director for Consumer Strategy and Development at HealthPocket.com, completed this survey analysis.

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George Bailey

You refer multiple times to the chart below on Advantage Plans. So where’s the charts???????

DG Ray

I am a retired Insurance agent and was in the senior market since 1967. I am totally familiar with all aspects of the way seniors think when it comes to purchasing Insurance products. I have sold thousands of Medigap policies when they were the only product available to those on Medicare. Premiums were the overriding factor that determined what decision the senior would make, coverage was second. Late in my career the federal govt. decided to manage the Insurance market and started to release the “Medicare Advantage” plans. These plans came with all kinds of different co-pays, deductibles and various prescription benefits. Medigap policies do not include prescriptions in their benefits, you need to purchase a separate policy. When I retired I needed to make a decision between a stand-alone Medigap policy or a Medicare Advantage plan. I am now in my fifth year of retirement and have been covered… Read more »

Cyndi Kurland

I have read that AARP actually receives a commission for each product sold. The TV ads stating that United Healthcare is only product to carry AARP’S name confers approval when it really means that that is the only company willing to pay them a commission.

Mike

AARP United Health Care Medicare Advantage plan is my third advantage plan. I don’t plan on ever leaving United Health care.the other plans I had I was refered toand first I couldn’t find any doctors that took them I had to go to a teaching school to get a doctor.plus with both of them their copays and prescription drugs prices skyrocketed. My copays and drug prices dropped, personally I’m very happy with AARP Medicare Complete Advantage plans.

Barbara mayer

My mom 87 has ARPP MEDICARE COMPLETE. She had a fall and needs in home physio therapy. I called United Healthcare and had them give me providers. None would except I called 6 providers and the rep at United Healthcare called 6 and not one provider on their list accepts ARPP MEDICARE COMPLETE because of the WelMed. Now I can’t find a physio therapist for my mom…I told the United Healthcare rep this was unacceptable and why they have these providers on there list…all he said was I’m sorry but he didn’t know who else to call. TOTALLY OUTRAGEOUS.

Concerned daughter

My mother, a 70yo Washington Co Ohio teacher was coerced into a Medicare Advantage plan through STRS last year when she retired. She was told this was a supplemental policy that would cover the additional 20% of Medicare remainders. In addition, she was further upsold for the “best policy”. Last week (her first claim) she had an accident where she fell and had 2 compound fractures in her leg and required immediate surgery. The hospital told us she had poor coverage and was denied anything past a 6 hours post surgery stay. She was sent home BY AMBULANCE without any follow-up, unable to stand and care for herself whatsoever. I was told if she had Medicare alone, she would’ve had more coverage and options for hospital care, physical therapy and rehabilitation. When contacting AETNA we were given the run-around, was told the coverage was there and blamed the surgeon’s report… Read more »

Jan

A friend referred me to AMAC for information on medicare advantage plans. My husband turned 65 in December and I will be 65 in March. Presently we have the Federal BlueCross/BlueShield. I have spent time researching medicare since September 2013 and still haven’t made a decision. We will both sign up in February to be effective March 1. This whole process has been a nightmare. The medicare site is confusing and frustrating. We have been looking at UHC through AARP (no I am not a member!) and may go with them. So here I am, joined AMAC to get information on their medicare advantage plans, have to submit my phone number for them to call. That is majorly irritating, I want to research their different programs before talking. Not sure this is going to work. After reading the other emails UHC is not the most reliable company. What other options… Read more »

George Fernsler

I took the United Medicare Advantage PPO plan in NY for several reasons-1. It was the only PPO Advantage program for NY not charging extra to enroll for basic PPO in-network services (probably because AARP got their deal to exclude their money-train partner from extra regs and fees from Obama Care law) 2. They claimed a large PPO network (but i find the claim exaggerated. Most nearby doctors will not participate, because they are so nickel and dime sticklers to exact rules and details to avoid paying their portion from Medicare.} 3..They offer a dental plan premium, which amazingly needs only to be active and paid for those months that you plan to see a dentist. It can be turned off and on, if you no longer need heavy dental coverage. 4. It offers a vision plan supplement. 5. Most importantly to me it offers in-network audiologist coverage -AND ability… Read more »

Diane

I have UHC complete plan one. All was fine the first year there after the co pays and co insurance continues to rise. Then in Dec 2013 they notified their members of all the doctors they were letting go. One of them was our PCP he had told us himself so we could find a doctor elsewhere. UHC waited to the eleventh hour to notify their insured that they were doing this with a letter saying this will provide us better health care. Who are they kidding. I will be dumping them ASAP. They also did not notify me last year when we met our yearly deductible of $6700 and we continued to pay co pays and insurance co pays. They stopped sending us EOBs so I had no way of knowing. Found out by accident and had to go through the turmoil of getting providers to refund nearly $1000.00.… Read more »

steven p anderson

I turn 65 in January 2017. I am trying to compare costs between a Kaiser plan and the AARP United Healthcare plan. Kaiser rates higher in quality but I am unsure what a dollar to dollar comparison would be. Are there any links to sites that compare rates?

Thomas DeLoach

Is there a more current blog with 2014 or 2015 comments. Is there a viable UHC alternative in SC? Too late for this year but would like to plan ahead.

Katherine B.

I just turned 50, I am now on Medicare for a major disability. I have to pay 500.00 per month to get coverage. United Health Care doesn’t like it but the government makes them take us young ins who cost a fortune.

Golden Rule /UHC has always paid my bills and covered most everything.

Ginny Brewton

Just ran across this blog while looking for low-cost medicare plans for my 92 year old mother. She’s had a Medigap policy for years and years, but the cost has now increased to the point she can’t afford it. I am hoping to switch her to Kaiser Senior Advantage, but hope the lack of Part D on her plan won’t be a problem, as Medicare will penalize those with out “credible coverage” by imposing a fine every month. I hope her Drug discount card from Banker’s Fidelity will work. My daughter and son-in-law suggested Kaiser Senior Advantage for my husband and me. They are both Kaiser Doctors in CO. We are in Georgia and fortunate enough to live in a county where Kaiser is availabe. We pay NO monthly premiums, just a $30.00 co-pay for Dr. visits and high co-pays for procedures, still low enough for us to save money… Read more »

Pat O'Connor

My Mother,Dad,& lovely TRI-SOMY 21 Sister Eileen Marie Margaret O’Connor had great insuranse; I CONTINUE TO INVESTIGATE THEIR BRUTAL, COLD BLOODED MURDERS, BY THE LUCUFER/SATAN, MEDICAL FOLKS. MANY DUNGEON&DRAGON, EVIL PRACTIONERS IN MEDICINE. It is dangereous to be in any HOSPITAL, especially, CATHOLIC HOSPITALS because you’d think safe!

Paddy O’Connor

KarenFaye

If AMAC can come up with an affordable supplement plan, Great! Our United is going up from $127 each to $196 each in October. Howinhell are seniors with no ADJUSTED income supposed to afford these increases? Two of the three drugs I must take have tripled since January, plus, Medicare told us the local pharmacy wasn’t “preferred “, so unless we wanted to spend an additional $8 for each scrip – (and we need 7 between us) – we now have to drive 22 miles to the pharmacy they approve of. What crapola!!! We’ve checked around and cannot find another supplement comparable any cheaper. Obama thinks anyone over 65 is deadmeat anyway, so couldn’t care less if we all croak at the same time. (He then can send our SSI money to Egypt or Pakistan for more weapons to use against us) Since he has Iran and Russia laughing at… Read more »

Bob Jennings

Advantage plans were great for several years but now they are in trouble. The Obama administration severely cut their benefits.Many Drs and durable goods suppliers are not accepting patients having Advantage plans. Additionally several hospitals in my area do not accept any United Health Care plans because they cannot reach contract agreement.

Ray R

Archie said,”I am particularly put off by AMAC when they offer Advantage Plan without saying who the insurance company is. You have to call them to find out. I like doing my research BEFORE I listen to a sales pitch. Until I know who
their “better than” AARP plan coverage is, I’m not going to call or email or whatever. I don’t like “games”.
Be up front with what you offer or I may leave this organization.”

I agree completely. I wanted to followup on the AMAC plan, but didn’t because the insurance company wasn’t identified and a phone call was required.

As well, I would really like to see a comparison of Medigap plans. This appears to be a better and less expensive way of getting coverage.

Tom Caldwell

I have United health care no problems so far also had them when I was working full time no problems then as well. I would like to see what you have but like previous poster I NEED to know who it is first so my daughter can research them for me she works in the insurance business and helps us get what we need.

Archie Hubbard

While this article is informative, I would have liked seeing a list of the winners so to speak. Having a negative review without giving us a solution (s), isn’t helping us to choose wisely.
I am particularly put off by AMAC when they offer Advantage Plan without saying who the insurance company is.
You have to call them to find out. I like doing my research BEFORE I listen to a sales pitch. Until I know who
their “better than” AARP plan coverage is, I’m not going to call or email or whatever. I don’t like “games”.
Be up front with what you offer or I may leave this organization.

Adeena Pomerenke

Interesting. Those plans you said were best are not available where we live. Although I hate having the AARP letters on my health card they are A. Those most affordable B. All my doctors take that plan. C. A number of them will not accept Humana. United health Care has paid promptly and I have had no problem finding a specialist with them. I would be delighted to find another plan without AARP branding but so far have not found one. I am not a member of theirs nor have I been for over 25 yrs. So I will continue to watch for another one but will not give up the doctors I have just because I don’t like AARP.