Advertising by Insurers Favors Medicare Advantage Over Stand-Alone Drug Plans, Kaiser Analysis Finds
The content and frequency of television, print and radio advertisement forMedicare plans was analyzed from Oct. 1 through Dec. 31, 2007, the period wheninsurers were permitted to market their 2008 plan offerings and whenbeneficiaries were expected to revisit their Medicare drug plan and MedicareAdvantage plan choices for the coming year. The study looked at ads placednationally or in one of three local media markets (Miami/Fort Lauderdale,Fla.; Phoenix, Ariz.; and Greensboro, N.C). All ads were identified by VMS, amedia monitoring service.
Insurers spent more than twice as much for Medicare Advantage (whichprovide all Medicare benefits and often additional benefits) than for stand-alone drug plan ads (an estimated $30.1 million and $13.7 million,respectively) placed nationally and in the three markets. Estimatedexpenditures are based on the standard cost of ads and do not include othermarketing and promotional expenses, such as direct mail and broker fees.
"Since ads for Medicare plans tend to be skimpy on basic, descriptiveinformation, beneficiaries and their families really need to do their homeworkbefore they choose a plan or decide whether to switch plans during openenrollment," Kaiser CEO and President Drew Altman said. The 2009 enrollmentseason runs from Nov. 15 though Dec. 31, 2008 for Medicare drug plans, andthrough March for Medicare Advantage plans.
Extra benefits were the dominant message in ads for Medicare Advantageplans, reflected in 71 percent of all occurrences, and most frequentlyemphasizing vision, preventive care and hearing benefits. Most MedicareAdvantage ads (56 percent) also emphasized either no or low premiums for theirplan.
The majority of Medicare Advantage ad occurrences (79 percent) explicitlyidentified whether they were promoting a Medicare HMO, PPO, private fee-for-service or other specific type of plan. The one in five that did not specifya type of Medicare Advantage plan could leave people on Medicare and theirfamilies unaware of the plan's potential restrictions on choice of physiciansand other providers. The Medicare Improvements for Patients and Providers Actof 2008 includes a provision to address this concern, requiring insurers toinclude the type of plan by Jan. 1, 2010.
In Medicare Advantage print ads, two thirds (67%) of all occurrencesincluded a general statement indicating restrictions and limitations may apply- but always in the fine print. None of the HMO print ads included languagedescribing provider network restrictions, as suggested in the Centers forMedicare & Medicaid Services' marketing guidelines.
Other key findings from the study include:
-- Only 3 percent of ad occurrences included images of younger people withdisabilities - despite the fact that 16 percent of all Medicare beneficiariesare under age 65 living with permanent disabilities. Less than 1 percent ofall ad occurrences mentioned the disabled population on Medicare explicitly.
-- Images of seniors with apparent medical needs or frailties were notcommonly featured in ads, despite the fact that 38 percent of Medicarebeneficiaries have three or more chronic conditions. Even with the relativelynew Medicare drug benefit, only 14 percent of all ad occurrences (and just 22percent of stand-alone drug plan ad occurrences) portrayed a
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