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Health Plan Comparison Toolby Consumers’ CHECKBOOK/Center for the Study of Services

1625 K Street, NW, Washington, DC 20006800-213-SAVE (7283) PlanCompare@checkbook.org

Presenters: Robert Krughoff, President

Robert Ellis, Director of Operations and Online Services

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Purpose• The purpose of this presentation is to describe recommended features of a

health plan comparison tool to help consumers and small employers choose plans that best meet their needs and preferences.

• We will demonstrate a model tool we have developed. • Model tool will help states if they are creating Exchanges under ACA.• Will also help large employers or employer coalitions if they wish to offer

employees multiple plan choices.• Will work best in an environment where premiums can be known, and

issuance can be required, based on a limited set of age, family size, and other user-known characteristics—but some features will be useful in other environments.

• A good tool is needed to—– Help consumers save money and get quality by making the best

personal plan choice.– Drive plans to be efficient and consumer-responsive.– Create market leverage for health system improvement.

Basis for Our Recommendations• Our recommendations are based on our experience as a non-profit

consumer organization supporting itself for 36 years by providing information that consumers value enough to purchase, online and in books and magazines, none of which carries any advertising—– The online resources and publications we offer include evaluations of

service providers from auto repair shops to plumbers to various kinds of healthcare providers (doctors, hospitals, dentists, etc.) and insurers.

– Our online and print Guide to Health Plans for Federal Employees and Annuitants—has for 33 years been purchased by individuals and has for more than a decade been purchased in bulk by dozens of agencies (HHS, Labor, IRS, U.S. Senate, Federal Reserve, many others) to help consumers make open-season choices.

• We also have much other experience doing research and analysis in the health care field—e.g., managing all of HHS’s surveys of Medicare Advantage and Drug Plan members for Medicare.gov

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A Few Key Features of a Good Tool• Comparison of plan costs—premium plus out-of-pocket—for the user’s

age and family characteristics—estimating the insurance value of each plan.

• An all-plan provider directory so that the user can quickly see which plans have his or her preferred providers.

• Quality information on each provider, with measures evolving over time.• Measures of each plan’s quality, and its health promotion programs.• Descriptions and assessments of the value of special plan features such

as dental coverage or a fitness club benefit.• Highlighting of any unusual coverage or service gaps.• Design, language, illustrative examples, interactive demonstrations, and

other features that are user-tested for ease of use and user understanding.• Features to enable intermediaries—from family members to brokers to

Navigators to the media—to extract or print out information to help consumers who want help.

• Ability to get the user to an excellent plan choice within five minutes with flexibility for users to drill down, if they wish, for increasing detail.

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Cost Comparison• A valid, quick comparison of premium plus out-of-pocket cost is essential.• This is what consumers want most.• We believe the correct way to do this is an “insurance-value” model to

give the user an estimate of the likely out-of-pocket costs for someone with the user’s age, family size, and other characteristics. And also give user— – An estimate of the cost in an unusually good year or an unusually bad

year and the likelihood of having such a year, and– An estimate of the maximum out-of-pocket cost for an individual or

family like the user.• The Consumers’ CHECKBOOK model makes these estimates using

population expenditure data from AHRQ’s Medical Expenditure Panel Survey and other sources.

• This approach is not what most currently available, or currently discussed, plan comparison tools do—and that is a reason for serious concern.

• We will describe here the two approaches generally used and then include a slide with a greatly simplified illustration of how our insurance-value model works.

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Benefit Description Model• Most cost comparison tools just describe benefits—deductibles, co-

pays, out-of-pocket (OOP) limits, etc.• This is what the Massachusetts Connector and Healthcare.gov do.• This leaves the user the baffling task of figuring out the relative value

of different benefit packages. • Consumers can’t figure out, for example—

– Is a plan with a $200 deductible and $10,000 OOP limit better than…

– A plan with a $1,000 deductible and $4,000 OOP limit…– And what about different co-payment levels, different coinsurance

rates, differences in which charges are counted against the deductibles or against the OOP limit, etc.

• This is very confusing and does not provide a sufficient basis for consumers to choose plans.

“Known-Usage” Model• A few tools apply what can be described as a “known-usage”

model.• These ask the user to predict how many doctor visits,

prescriptions, etc. the user will have next year.• This approach is appropriate when planning a contribution to a

Flexible Spending Account, but not for choosing insurance.• A “known-usage” model misleads by ignoring expenses for

diseases, accidents, and other care needs that can’t be predicted—potentially large expenses that are a major reason for insurance.

• The insurance-value model we recommend can include adjustments for known usage—a planned pregnancy or an expensive maintenance drug—as part of the calculation but not as the entire calculation.

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Insurance-Value Model—Simplified Illustration Using a database of expenses of actual households, one can either calculate the OOP expenses

under each plan for all households of a type and average them or, as in this simplified illustration, create a number of representative overall expense-level and expense-distribution

profiles and probabilities and calculate a weighted average OOP expense estimate.

Level of total expense: $0 $1,000 $2,500 $5,000 $10,000 $25,000 $150,000Probability of expense at this level 3% 16% 17% 16% 23% 21% 4%

Components of expense:Hospital room and board $0 $0 $0 $1,200 $2,300 $6,000 $50,000Other inpatient hospital $0 $0 $0 $1,200 $2,300 $6,000 $50,000Surgical $0 $0 $0 $0 $2,000 $4,000 $25,000Routine exams $0 $300 $300 $300 $300 $300 $300Other medical $0 $400 $1,200 $1,300 $1,900 $4,700 $16,700Prescription drugs $0 $300 $1,000 $1,000 $1,200 $4,000 $8,000

OOP member would pay in ABC Plan $0 $700 $1,120 $1,370 $1,870 $3,370 $9,000OOP exp. times probability of this exp. $0 $112 $190 $219 $430 $708 $360

Simplified illustration: for households with a 49-year-old husband and wife--for ABC Health Plan

ABC health plan has $2,500 premium after any subsidy for this policyholder, $1,000 deductible, 10% coinsurance on all expenses after deductible, $8,000 OOP limit not counting deductible, routine exams fully covered.

Estimated average OOP in ABC Plan for households like this (sum of row above): $2,020Enrollee share of premium in ABC Plan: $2,500

Estimated total cost (premium plus OOP) for households like this: $4,520 (this is number shown on website)

A demonstration of the plan comparison tool Consumers’ CHECKBOOK has developed follows.

More detail on our recommendations, a video demonstration of our model tool, and other resources on this subject can be found

at www.checkbook.org/exchange.

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CHECKBOOK/CSS Plan Comparison Tool

Welcome Screen with Introductory Video

About You – The majority of the information gathered in this user profile page can be passed through to CHECKBOOK/CSS as hidden variables from the Identity Verification/Eligibility components of a state Exchange or possibly from employer records of a private Exchange. In that way, the user will see a dramatically simplified version of this page.

Audio Tips – Short audio explanations are available on nearly all information points. Additionally, the user may choose to have an Audio Guide where many of the audio advice elements are automated to correspond with the user’s progress. Text is always provided alongside audio or video components to maximize accessibility.

Doctor Directory – An Exchange-wide doctor directory is presented so the user can enter the names of any current doctors, select from the drop-down list, and know in which plans their doctors participate in.

Doctor Chooser – Help is provided to find doctors recognized on a variety of quality considerations should the user need to find a doctor recognized for quality.

Choose a Doctor – Quality Doctor selection page

Selected Doctor – Doctor chosen from Exchange-wide directory.

Summary Ratings Results – Displaying Plans ranked by Cost for Someone Like You – Combined Total Cost including Yearly Premium less any government assistance or subsidy plus Health-care Costs YOU Pay , Most You Could Pay in a Year, Overall Quality Score, Doctor Result, Plan Type, and Metal Level. Visual cues point to most important information.

Video Explanations - Use our specially prepared videos to help explain certain critical considerations on the main Summary results page. Adjunct text improves accessibility.

Accessible Explanations - Nearly every information point has a handy pop-up text explanation available.

Sort By Your Preference – Display plans ranked from low to high or high to low, depending on your preferences, on any of our information columns. Here we see Most You Could Pay in a Year sorted from high to low, revealing some important warnings and considerations.

Enhanced Cost Information - Allows the user to see rankings of plans on cost in Good, Bad, Average, and Extremely Bad years and shows the likelihood of Having a Good or Bad year for “families like yours.”

Personalized Quality Score – Quick access to the ability to weight quality measures that are important to the user.

Personalized Quality Rating - Allows the user to weight a variety of quality measures on what’s important to them and recalculate a new set of Quality star scores for the plans.

Personalized Quality Rating - Allows the user to weight a variety of quality measures on what’s important to them and recalculate a new set of Quality star scores for the plans.

Personalized Quality Rating – Underlying information on top-level quality measures, for those who wish to look at specific questions and scores. Includes information on customer experience, disputed claims rates, and adherence to best practices in diabetes care, heart disease, cancer, back pain, and more.

Personalized Quality Rating - Allows the user to weight a variety of quality measures on what’s important to them and recalculate a new set of Quality star scores for the plans

Deductibles/Copays/etc - Provides information on plan deductibles, copays, coinsurance, and contributions to health savings accounts.

Dental - Multiple layers of information on both health plan dental coverages and stand-alone dental plan coverages.

Summary Dental – Costs if your dental care usage were None, Low, Average, and High. Includes listing of the Maximum Benefit amount.

Key Benefits – Child and adult preventive and restorative coverages and more.

Detailed Benefits – Coverages by procedure.

Filters and Customization Tools - Narrow your choices with filters and preference tools once you’ve seen the variety of costs and quality available to you.

Side-by-Side Comparison: Compare data in multiple ways. Use columnar comparison under the table tabs, as shown on earlier screens, or create a side-by-side report on all coverage details and costs for up to four selected plans.

Create a Custom Print Report –

Particularly helpful to assisters like family members, navigators, and others is the ability to create a custom print report on the chosen plan comparisons, showing cost and quality comparisons and including useful advice on plan selection.

We Wrote the Book: For its Guide for Federal employees, Walton Francis and CHECKBOOK/CSS have literally written the book on health Insurance, providing an in-depth look at how the system works, what it all means, and how consumers should best go about making their choices. Similar advice can be prepared for users of any Exchange.

CHECKBOOK/CSS Plan Comparison Tool

For more CHECKBOOK/CSS information on helping consumers and employers choose the health plans that best meet their needs and preferences, visit –

www.checkbook.org/exchange