The Most Frequently Disenrolling Seniors

1

THE MOST FREQUENTLY

DISENROLLING SENIORS

WISELY FRUGAL

NATURALISTS

HEALTHCARE DRIVEN

TRADITIONALISTS

Health Related Behavioral Profiles

FHP Market Research

September, 1996

Note: As of 2012, PATH = Patterns of Adapting to Health, Generics =

Wisely Frugal, Ready Users = Healthcare Driven

2

EXECUTIVE SUMMARY

Seniors can be grouped into nine distinct health care attitude and behavior

profiles. All nine profile types are represented among FHP senior plan

members.

Seniors with three distinct health care attitude and behavior profiles

(Independently Healthy, Generics, and Naturalists) account for over 40

percent of FHP Senior Plan members in Southern California in their first

year of membership.

Four groups: Generics, Naturalists, Ready Users, and Traditionalists show

higher rates of disenrollment than expected.

Disenrollment among Ready Users is expected to result in $2.07 million in

loss of premium revenue per 10,000 members per month; disenrollment

among the same number of Loyalists is expected to result in only $1.55

million in loss per month.

The health care attitudes and behaviors of as few as 10,000 members

account for a $6 million variance in annual premium loss due to varying

disenrollment risk.

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Contents

Introduction ........................................................................................... 3

Cost Implications of Varying Disenrollment Rates .......................... 5

Profiles of Frequently Disenrolling Members .................................. 8

PATH Profile Summaries .................................................................. 9

Generics ............................................................................................. 9

Naturalists .......................................................................................... 10

Ready Users ....................................................................................... 10

Health Plan Selection Factors and Satisfaction ................................. 10

Mapping of Health Plan Selection Factors and PATH Groups ........ 10

Health Plan Selection and Satisfaction ............................................... 12

Generics ............................................................................................. 12

Naturalists .......................................................................................... 14

Ready Users ....................................................................................... 15

Prescription Drug Behaviors ............................................................... 16

Generics ............................................................................................. 17

Ready Users ....................................................................................... 18

Naturalists .......................................................................................... 19

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INTRODUCTION

In a recent telephone survey of 1,322 disenrolled seniors, it was found that seniors with

the health care attitude and behavior profiles of Generics, Naturalists, Ready Users, and

Traditionalists (see PATH profiling below) account for just over half of those Southern

California senior disenrollees from FHP who left for voluntary reasons, as shown in Chart

1 below.

CHART 1

PATH Groups Among

Senior DisenrolleesMar-May, 1996, N=1322

Generic

19%

Naturalist

14%

Ready User

14%

Traditionalist

8%

Family

Centered

8%

Loyalist

6%

Independently

Healthy

11%

Avoider

4%

Unassigned

12%

Clinic Cynic

4%

Comparison of the distribution shown in Chart 1 with a profiling of the current senior

membership in Southern California in their first year* (September, 1995 to August 1996)

as shown in Chart 2 identifies four groups as having higher disenrollment rates than

expected as shown in Chart 3.

______________________________________ *Based on a mail survey of Southern California FHP senior members in their first year of

enrollment (N=49,000).

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CHART 2

PATH Group Distribution Among FHP Senior Members

(N=13,800)

Clinic Cynic

7% Avoider

4%

Generic

16%

Traditionalist

7%

Family Centered

8%Loyalist

10%

Ready User

10%

Independently

Healthy

14%

Naturalist

12%

Unassigned

12%

Seniors with three distinct health care attitude and behavior profiles

(Independently Healthy, Generics, and Naturalists) account for over 40

percent of FHP Senior Plan members in Southern California in their first

year.

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CHART 3

% Point Variances in Disenrollment Across PATH

Groups (Seniors, 1996)

-6.0% -4.0% -2.0% 0.0% 2.0% 4.0% 6.0%

Clinic Cynic

Avoider

Generic

Traditionalist

Family Centered

Loyalist

Ready User

Independently Healthy

Naturalist

Unassigned

Four groups: Generics, Naturalists, Ready Users, and Traditionalists

show higher rates of disenrollment than expected.

Cost Implications of Varying Disenrollment Rates

Higher or lower rates of voluntary disenrollment across specific groups impact revenue.

The level of the impact can be seen by applying the identified rates of disenrollment to a

specific number of members. Currently, among senior FHP members in Southern

California, those in their first year of enrollment (about 49,000) represent 25 percent of

the total senior Southern California membership (see Chart 4). FHP Senior Plan

members in Southern California in their first year of enrollment also account for 51

percent (see Chart 4) of Southern California senior member disenrollment. This

percentage was derived from analysis of senior disenrollment based on months of

enrollment as reported by HCFA.

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CHART 4

Cummulative % Members and Disenrollees

by Months of Membership

0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

50%

55%

60%

65%

70%

75%

80%

85%

90%

95%

100%

0 8

16

24

32

40

48

56

64

72

80

88

96

10

4

11

2

12

0

12

8

13

7

14

8

Months of Membership

Cu

mm

ula

tiv

e %

Members

Disenrollees

From July 96 through December 96, there were an average of 3,380 senior disenrollments

per month.

About 70 percent or 2,366 of these monthly drops are attributable to voluntary

disenrollment, for a projected yearly total of 28,392 voluntary senior disenrollments

per year, representing a 14 percent annual disenrollment rate.

Fifty one percent of these senior disenrollments or,

14,958 were from members in their first year of enrollment, representing a

30.5 percent first year (rapid) disenrollment rate.

Applying the 30.5 percent rapid disenrollment rate among first year senior members to a

population of 10,000 senior members and calculating the monthly premium loss (at $600

pmpm) for the lost 3,050 members, the projected loss is $1.83 million per month as

shown in the first column of Chart 4.

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CHART 4

Estimated Monthly Disenrollment $ Loss Among

1st Year Enrollees by PATH Group

Per 10,000 (Seniors, 1996)

$1,830,000

$2,076,000 $2,046,000

$1,548,000

$1,656,000

$1,140,000

$1,340,000

$1,540,000

$1,740,000

$1,940,000

$2,140,000

$2,340,000

10000

General New

Enrollees

10000

Ready Users

10000

Generic

10000

Loyalist

10000

Clinic Cynic

Member Types

(@$600 PMPM)

Disenrollment among Ready Users is expected to result in $2.07 million in

loss of premium revenue per 10,000 per month; disenrollment among the

same number of Loyalists is expected to result in only $1.55 million in

loss per month.

However, based on differences in the first year disenrollment rates by PATH group,

which vary between 35 percent (for Ready Users) and 26 percent (for Loyalists), the

potential amount of monthly premium loss is dramatically different per 10,000 of each

type (Chart 4). As shown in the chart below (Chart 5), on an annual basis the Ready User

loss is $2.9 million more than expected, while for Loyalist the gain is $3.3 million over

the general membership.

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CHART 5

Estimated Annual Disenrollment Loss/Gain

Variance Among 1st Year Members

by PATH Groups Per 10000, (Seniors, 1996)

$0

($2,952,000)

$3,384,000

$2,088,000

($2,592,000)($3,500,000)

($2,500,000)

($1,500,000)

($500,000)

$500,000

$1,500,000

$2,500,000

$3,500,000

$4,500,000

General

New

Enrollees

Ready

Users

Generic Loyalist Clinic

Cynic

Group Type

Do

lla

r V

ari

an

ce

Est. Yearly Loss/Gain

The health care attitudes and behaviors of as few as 10,000 members

account for a $6 million variance in annual premium loss due to

disenrollment.

Profiles of Frequently Disenrolling Seniors

Generics, Naturalists, Ready Users, and Traditionalists are four groups out of a possible

nine that make up the Profiles of Attitudes Toward Healthcare (PATH) segmentation

system. Each group is defined by a profile that contains information across eleven

dimensions of health care thinking and behavior as shown in Table 1.

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Table 1: Frequently Disenrolling PATH Groups

Attitudes and Behaviors Generics Naturalists Ready Users Traditionalists

Involvement in family health low moderate low low

Trust in medical professionals mod high low high indifferent

Willing to experiment high high high mod low

Propensity to avoid healthcare high high low mod high

Information seeking high high high low

Receptivity to advertising high moderate high mod low

Involvement in decision-making mod high high high high

Health proactive low high high low

Price concern high moderate low low

Quality concern moderate high high high

Health emphasis and involvement low high high low

Traits shared by three of the four groups that could feed into disenrollment are:

* willingness to experiment,

* information seeking, and

* receptivity to advertising.

All these traits make these adults prime targets for competitive advertising or competitive

sales efforts. These seniors are more likely to pay attention to an advertisement, make a

call as a result of what they’ve seen, or favorably respond to a sales call. Their high

penchant for seeking health care information indicates higher levels of education and

knowledge of healthcare treatments and options.

PATH Profile Summaries for the Top Three Disenrolling Groups Generics

Generics are more likely to be swayed by price and cost issues. Quality is not the only

driver. The Generic adult puts little effort into practicing proactive health behaviors for

themselves or their family members, whether it be working to stay in physical shape or

practicing good nutrition. They will also put off seeking medical care until an ailment or

injury is very bad. Again, the reason for avoidance is generally cost related. Generics

are receptive to and seek out health care information--again, often driven by the need for

the best economic option. Their attentiveness to and basic trust in health care advertising

allows them to satisfy their information needs through this medium. Their trust in

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medical professionals is moderately high and, along with their cost concern, this may feed

their willingness to experiment with different treatment options or alternatives.

Naturalists

Naturalist adults are less likely to be swayed by price and cost issues, but still consider

them. Quality is, however, a more compelling driver. The Naturalist adult puts a greater

effort into practicing proactive health behaviors for themselves. Because the Naturalist

adult has high distrust of most medical care providers, they will also put off seeking

“regular” medical care until it is the last resort. The Naturalist prefers experimenting

with different treatment options or non-medical alternatives. The Naturalist is attentive

to most health care advertising, but evaluates it with a skeptical eye. Their high level of

health care information seeking is generally biased towards supporting their trust in

alternative healing therapies and distrust of regular medicine.

Ready Users

Ready User adults are very unlikely to be swayed by price and cost issues like the

Naturalists. Quality is their number one concern. Unlike the Naturalist, Ready User

adults have greater trust and confidence in medical care providers. As a result, Ready

Users, as their name implies, will seek medical care at the first sign of trouble. Like the

Naturalist, the Ready User adult puts a greater effort into practicing proactive health

behaviors for themselves, and is willing to experiment with different treatment options or

non-medical alternatives. However, Ready User adults will generally consider non-

medical alternatives as supplements to regular medical care, rather than replacements for

it. The Ready User is attentive to most health care advertising, and fairly receptive to

messages from medical care providers or insurers. Their high level of health care

information seeking is generally unbiased towards alternative healing therapies or regular

medicine.

HEALTH PLAN SELECTION FACTORS AND SATISFACTION

Note: The analysis of each adult group are derived from data available in the

Sachs/Scarborough 1995 HealthPlus survey for Los Angeles. The results are based on

5,680 interviews. The selection of both HMO and non-HMO plans are evaluated.

Mapping of Health Plan Selection Factors and PATH Groups

Information relating PATH groups to reasons for selecting a health plan, whether

indeminty, PPO, or HMO, were translated into a two dimensional “positioning” map, as

shown in Chart 1. In this map:

PATH groups located close together evaluate health plan selection criteria the same

way, and

PATH group proximity to selection factors indicates the level of importance placed

on them. Greater proximity indicates greater importance, lesser proximity indicates

lesser importance.

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Chart 1: Mapping PATH Groups and Health Plan Selection

MAPPING OF PATH GROUPS

IN RELATION TO HEALTH PLAN CHOICE FACTORS

better coverage

dissatis. w ith old plan

other reason

no choice of planselected plan

plan reputation/doctor

location/doctor reputation

customer service

hospital reputation

hospital location

old plan too expensive

NATURALISTS

INDEP. HEALTHY

LOYALISTS

READY USERS

TRADITIONALISTSFAMILY CENTERED

AVOIDERS

GENERICSCLINIC CYNICS

experience w ith plan

range of services

ease of paperw ork

my cost for premium

use spouse's plan

doctor in plan

clear benefit

IDEAL (AVERAGE) POINT

low deductible

Sachs/Scarborough 1995 HealthPlus, Los Angeles

Adults segmented by PATH group show differing levels of

importance for the reasons used to select their health plan

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Chart 2: PATH Groups Involvement in Evaluating Selection Factors

MAPPING OF PATH GROUPS

IN RELATION TO HEALTH PLAN CHOICE FACTORS

better coverage

dissatis. w ith old plan

other reason

no choice of planselected plan

plan reputation/doctor

location/doctor reputation

customer service

hospital reputation

hospital location

old plan too expensive

NATURALISTS

INDEP. HEALTHY

LOYALISTS

READY USERS

TRADITIONALISTSFAMILY CENTERED

AVOIDERS

GENERICSCLINIC CYNICS

experience w ith plan

range of services

ease of paperw ork

my cost for premium

use spouse's plan

doctor in plan

clear benefit

IDEAL (AVERAGE) POINT

low deductible

Sachs/Scarborough 1995 HealthPlus, Los Angeles

Level of perceived

choice, Level of

consideration of

choice factors

Level of perceived

choice, Level of

consideration of

choice factors

low

high

Naturalist, Ready User, and Traditionalist adults give more

consideration to definite reasons for selecting health plans.

Avoiders, Generics, and Clinic Cynics give less thought to

specific reasons.

HEALTH PLAN SELECTION AND SATISFACTION

GENERICS:

Choice of Health Plan. Generics less frequently attribute the selection of their health

plan to themselves when compared to the general population. Generics match the general

population in the level of reporting of not having a choice of health plan.

Health Plan Selection Factors. Generics mention the expense of their previous plan as a

reason for choosing their current plan at levels consistent with the general population

(about 9%). Other specific selection factors, such as range of services, ease of

paperwork, cost of premium, or doctor and hospital reputations, are consistently less often

mentioned by Generics.

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Satisfaction With Health Plan. Fewer Generics report high satisfaction with their

current health plan when compared with the general population. Generics are

consistently less likely to report high satisfaction with

waiting times for physician appointments when sick or well

physician’s office waiting times when sick or well

emergency care

the prompt and courteous processing of claims

range of services

referrals to specialists

quick test results processing

quality of customer service

overall quality of care

hospitals in the plan

explanation of benefits

their ability to changes MD in the plan, and

hospital and MD office locations

These trends result in Generics being less likely to recommend their current health plan to

friends or relatives, or to indicate that they intend to renew the coverage.

Complaint Behavior. Generics are more likely to complain to their employer, insurance

company, or someone unrelated to them, rather than to family and friends, their physician,

or state or federal agencies.

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NATURALISTS:

Choice of Health Plan. Just over half of Naturalists attribute the selection of their

health plan to themselves, which is consistent with the general population. While just

about a quarter of the general population report not having a choice of health plan, this is

less true for Naturalists who report having no choice of plan at rates 25 percent lower

than the average.

Health Plan Selection Factors. Doctor locations, low deductibles, and hospital

locations are mentioned as important factors among Naturalists at rates consistent with

the general population. Selection factors that standout for Naturalists include:

range of services

ease of paperwork

experience with the plan

their own cost of premium

the reputations of the doctors and hospitals in the health plan

the expense of their previous plan

the fact that it is their spouse’s coverage

Fewer Naturalists report selecting their current plan because of its superior coverage or

because of dissatisfaction with the old plan.

Satisfaction With Health Plan. Fewer Naturalists report high satisfaction with their

current health plan when compared with the general population. Naturalists are

consistently less likely to report high satisfaction with

waiting times for physician appointments when sick or well

physician’s office waiting times when sick or well

emergency care

the prompt and courteous processing of claims

range of services

referrals to specialists

quick test results processing

quality of customer service

overall quality of care

hospitals in the plan

explanation of benefits

their ability to changes MD in the plan, and

hospital and MD office locations

These trends result in Naturalists being less likely to recommend their current health plan

to friends or relatives, or to indicate that they intend to renew the coverage.

Complaint Behavior. Naturalists are more likely to complain to family and friends than

to their physician, and almost three times more likely to complain to state or federal

agencies.

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READY USERS:

Choice of Health Plan. Sixty-eight percent (68%) of Ready Users attribute the selection

of their health plan to themselves, which is 32 percent higher than the general population.

Ready Users report having no choice of health plans at rates 13 percent lower than the

average.

Health Plan Selection Factors. Doctor locations are mentioned as important among

Ready Users at rates 39 percent higher than the general population. Other selection

factors that standout for Ready Users include:

range of services

that their current physician is in the plan

ease of paperwork

experience with the plan

the reputations of the doctors and hospitals in the health plan

the health plan’s reputation

getting better coverage and benefits

dissatisfaction with their old plan

clear benefit description

Satisfaction With Health Plan. More Ready Users report high satisfaction with their

current health plan when compared with the general population. Ready Users are

consistently more likely to report high satisfaction with

waiting times for physician appointments when sick or well

physician’s office waiting times when sick or well

emergency care

the prompt and courteous processing of claims

range of services

referrals to specialists

quick test results processing

quality of customer service

overall quality of care

hospitals in the plan

choice of pharmacies

explanation of benefits

their ability to changes MD in the plan, and

hospital and MD office locations

These trends result in Ready Users being more likely to recommend their current health

plan to friends or relatives, or to indicate that they intend to renew the coverage.

Complaint Behavior. Ready Users are more likely to not complain at all, whether to

family and friends, their physician, or state or federal agencies.

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PRESCRIPTION DRUG BEHAVIORS

Prescription drug behaviors described in this section cover the following areas:

New or renewal of prescriptions in the past 12 months and compliance

Number of medications taken weekly

How the first prescription was filled

Whether physician or pharmacist discussed side effects, dosage, and use of generic

medications

Respondents preference for brand name vs generic medications

Level of choice in choosing brand name vs generic medications

Medication switching.

The quantitative index scores describing prescription drug behaviors are shown in Table

2.

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Table 2: Prescription Drug Behaviors Across PATH Groups

Ready Independently

Behaviors Generics User Naturalist

New Prescription or Renewal in last 12 mos 98 123 100

Taken Prescription as Directed 99 126 100

# Prescr Drugs Used per week-None 106 72 81

# Prescr Drugs Used per week-One 96 88 81

# Prescr Drugs Used per week-Two 110 94 142

# Prescr Drugs Used per week- Three 75 265 124

MD or Pharm Discussed: Side Effects 98 102 96

MD or Pharm Discussed: Recommended Dosage 100 111 91

MD or Pharm Discussed: Brand vs Generic 95 87 105

Brand vs Generic: Bought Generic 103 89 106

Brand vs Generic: Brought Brand Name 96 148 90

Brand vs Generic:Don't know which bought 104 77 74

Brand vs Generic: Don't know difference 101 26 94

Know if Presc is Brand/Generic 128 78 75

Pref Brand Name Over Generic 114 84 94

Cost is Prim Reasn Use 82 133 99

Brand vs Generic: Pharm Gave Choice 104 86 114

Brand vs Generic: No Choice, MD wrote 105 151 95

Brand vs Generic: No Choice, Insurance req. 96 107 85

Brand vs Generic:Not sure if have choice 98 74 86

Switched Brands for Same Drug 108 176 126

Switched Brands: MD initiated 108 214 94

Switched Brands: Pharmacist initiated 69 173 163

Copyright 1996 Scarborough Research Corporation

Los Angeles HealthPlus 1995

Explanation of Table 2 Scores:

Population average = 100

Higher rates of behavior > 100

Lower rates of behavior < 100

Example: Generics have a score of 114 for “prefer brand name over generic”

medications, which means that Generics prefer brand name over generic medications at

a rate 14 percent higher than the general population. Conversly, the Generic score for

using three drugs per week (# prescri drugs Used per week- Three) is 75, which means

that the number of Generics taking three different medications per week is 25 percent

lower than the number in the general population.

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Prescription Drug Behaviors

Generics

Highlights

Less frequent use of multiple medications

Slight preference for brand name drugs over generic drugs

Other trends follow population averages

On a yearly basis, Generics start new or renew prescriptions at rates consistent with the

general population. In terms of the number of presciptions taken weekly, Generics vear

away from the crowd by taking three medications weekly at rates 25 percent lower than

expected. Generics’ report engaging in discussions with their physicians about

medication dosage, side effects, and the use of generic drugs at rates consistent with the

general population. Generics are no more likely to buy name brand over generic

medications, to know which one they bought, or to really understand the difference as

compared to the general population. However, Generics report more often preferring

name brand over generic drugs. Generics are consistent with the general population in

reporting that their pharmacist, physician, or health plan dictated the choice of brand

name vs. generic medication they received. Generics less often report that the pharmacist

was responsible for switching their brand of medication.

Ready Users

Highlights

More frequent renewal or obtaining of new prescriptions

Higher compliance in taking medications as prescribed

Greater likelihood of taking multiple medications

More frequent discussions with physician about dosage

Less frequent tolerance of generic drugs in substitution for brand name drugs

Greater acceptance of physician directives

On a yearly basis, Ready Users start new or renew prescriptions at higher rates than the

general population. Ready Users are also more compliant in terms of taking drugs as

prescribed. In terms of the number of presciptions taken weekly, Ready Users have the

highest number of members taking three medications per week; the rate, in fact, is 265

percent higher than the general population. More Ready Users report engaging in

discussions with their physicians about medication dosage, while fewer Ready Users

report having discussions with their physicians about the use of generic vs brand name

drugs. Ready Users are more likely to buy brand name over generic drugs, and more

Ready Users report knowing the difference between the two. Ready Users more

frequently report that the choice of brand name vs. generic drugs is dictated by the

physician or the Ready User’s health plan. Ready Users also more frequently understand

that their current situation does not give them the option. If a medication is switched,

Ready Users attribute the switch to action by their physician at a rate 214 percent higher

20

thant he general population. Ready Users also more frequently attribute the switching of

medications to themselves, or their pharmacist.

Naturalists

Highlights

More frequent taking of multiple medications

Less frequent discussions with physician about dosage

More frequent buying of generic vs brand name drugs and more knowledge of

difference

More frequent tolerance of generic drugs in substitution for brand name drugs

More frequent reporting of pharmacist offered choice, and less frequent mention of

physician or health plan restrictions in choosing medications.

Less reliance on physician directives in changing or switching medications; more

reliance on self or pharmacist to initiate switch.

Naturalists start new or renew prescriptions at rates consistent with the general

population. Naturalists are also equally compliant in terms of taking drugs as prescribed.

In terms of the number of presciptions taken weekly, Naturalists have more members

taking two drugs weekly, followed by three drugs weekly. Fewer Naturalists report

engaging in discussions with their physicians about medication side effects or dosage,

while more Naturalists tend to report having discussions with their physicians about the

use of generic vs brand name drugs. Naturalists are more likely to buy generic over brand

name drugs, and more Naturalists report knowing the difference between the two.

Naturalists less frequently report that the choice of brand name vs. generic drugs is

dictated by the physician or the health plan. Naturalists also less frequently report that

their current situation does not give them the option. If a medication is switched,

Naturalists more frequently attribute the switch to action by themselves or their

pharmacist, and less frequently to physicians.