Deductible-based Health Insurance Plans: Are Complex Deductible Exemptions Confusing Patients? Mary Reed, DrPH Center for Health Policy Studies, Kaiser Permanente Division of Research AcademyHealth Annual Research Meeting 2008

Maggie Price, MA 1 Richard Brand, PhD 2 Joseph P. Newhouse, PhD 3 John Hsu, MD, MBA, MSCE 1 1 Center for Health Policy Studies, Kaiser Permanente Division of Research, 2 Department of Epidemiology and Biostatistics, University of California, San Francisco 3 Department of Health Care Policy, Harvard Medical School; Department of Health Policy and Management, Harvard School of Public Health; Kennedy School of Government. Funded by The Commonwealth Fund, No other relevant disclosures

Introduction ► Patients are increasingly facing higher out of pocket costs through deductibles ► Deductibles could encourage patient participation as consumers of health care ► Effects of deductibles are likely influenced by patient knowledge of their complex plans ► Limited information exists about patient knowledge of and responses to deductible plans

Research Setting ► Integrated Delivery System (IDS): 2 California Regions Deductibles available since 2005 ► Deductible plans could be complex: Emergency Room Deductible applies: full price Copayment for all services Office Visits Deductible does not apply: copayment Medical Tests Spending Reaches Deductible

Objective ► Do patients know that they face a deductible and about which services are included? ► Does knowing about the deductible affect cost-related changes in changes in care-seeking? ► Emergency Room ► Office Visit ► Medical Test

Methods – Design/Population/Sampling ► Cross-sectional telephone interviews 1513 respondents; 83% response rate ► Population Adults Large or small employer group purchaser English-speaking ► Four randomly sampled strata Deductible and No deductible Chronic disease and No chronic disease (registry for asthma, coronary artery disease, heart failure, hypertension, diabetes)

Methods – Questionnaire Measures ► Did your health insurance plan include a deductible (for medical services)? Did your deductible apply to: ► Emergency Room Visits ► Doctor’s office visits ► Medical Tests ► Because of the amount you had to pay, did you: [for Emergency room/Office Visit/Medical Tests (if provider ordered)] ► Stay home and avoid seeking care? ► Delay seeking care? ► Seek out-of-system care? ► Talk with a doctor or nurse by telephone/internet?

Methods –Analysis: Multivariate Logistic Regression ► Dependent Variable Any change in care seeking behavior for: Emergency Room, Office Visit, Medical Test ► Independent Variable Knowledge of deductible and applicable services ► Covariates Socio-demographic: Age, Gender, Race/ethnicity, Marital status, Household income, Educational level Clinical: Self-reported health status, Chronic disease Healthplan region ► All analyses weighted for differences in sampling proportions

Table 1. Participant Characteristics Weighted for differences in sampling proportions *p<0.01 Characteristic Deductible No Deductible Total Gender: Female52%56%55% Have a PCP80%84%82% Health Status: Poor to Good Health46%45% Marital Status: Married65%68%67% Race/Ethnicity: Non-White49%55%52% Educational Level: Less than College31%21%25%* Household Income: <$40,00026%22%24% Age: Mean years Health plan member in previous year (2004)94%98%96%*

Table 2. Knowledge of Deductible Plan Correct knowledge of: % Among Patients with a Deductible Any deductible51.9% *Percents weighted for differences in sampling proportions Correct Knowledge of: % Among Patients who knew of Deductible Deductible amount35.4% All Services that applied to deductible5.1% Both deductible amount AND All services that applied2.2% Among Participants who knew they had a Deductible

Table 3. Emergency Room Behavior Changes and Deductible Knowledge Deductible applies to ED visits Deductible Knowledge % of Patients who Changed ED Behavior* OR 95% CI Non-deductible Plan (Reference group)25.3%1.0 Unaware of deductible29.9%1.30.9,1.9 Aware of Deductible Do not know deductible applied to ED visits 46.4%2.81.9,4.2 Know deductible applied to ED visits44.7%2.61.3,5.4 *Adjusted percent of patients reporting changing ED behavior because of cost; all analyses weighted for differences in sampling proportion; lower education and better self reported health also statistically significantly associated with ED behavior 18% of those who were aware of the deductible knew that deductible applies to ED visits

Table 4. Office Visit Behavior Changes and Deductible Knowledge Among plan with Office Visits exempt from Deductible Deductible Knowledge % of Patients who Changed Office Visit Behavior* OR 95% CI Non-deductible Plan (Reference Group)22.2%1.0 Unaware of deductible26.1%1.30.8,2.0 Aware of Deductible Know deductible did not apply to Office Visits 30.7%1.60.8,3.2 Incorrectly thinks deductible applied to Office Visits 34.4%2.01.2,3.3 Adjusted percent of patients reporting changing office visit behavior because of cost; weighted for differences in sampling proportion

Table 5a. Medical Test Behavior Changes and Deductible plan Knowledge Among Plans with Tests exempt from Deductible Deductible Knowledge % of Patients who Changed Medical Test Behavior* OR 95% CI Non-deductible Plan (Reference Group)4.4%1.0 Unaware of deductible10.2%2.61.0,7.1 Aware of Deductible Know deductible did not apply to Tests 15.7%4.61.3,16.0 Adjusted percent of patients reporting changing medical test behavior because of cost; weighted for differences in sampling proportion

Deductible Knowledge % of Patients who Changed Medical Test Behavior* OR 95% CI Non-deductible Plan (Reference group)4.4%1.0 Unaware of deductible23.4%8.13.2,20.6 Aware of Deductible Do not know deductible applied to Tests 28.8% ,22.8 Knows deductible applied to Tests48.3% ,87.3 *Among patients with a deductible plan; weighted for differences in sampling proportion; lower education and better self reported health also statistically significantly associated with ED behavior 29% of those who were aware of the deductible knew that deductible applies to medical tests Table 5b. Medical Test Behavior Changes and Deductible plan Knowledge Among Plans with Deductible applying to Tests

Limitations ► Single IDS with set delivery options and non- experimental allocation of deductibles ► Modest levels of deductibles and applicable services ► English-speakers only ► No measure of clinical impact

Conclusions ► Nearly half of patients did not know that they faced a deductible, extremely few knew plan details ► Patients who were aware of their deductible plan and plan details were more likely to change their care-seeking behavior ► Patients who mistakenly thought their deductible applied to office visits were more likely to change care-seeking behavior

Implications ► Confusion about deductible plans could inhibit patients’ ability to make informed decisions Special attention must be made to preventive services exemptions ► Changes in care-seeking behavior in response to deductible plans may raise concerns about the safety of these choices Need research on clinical and economic outcomes