Prophet 2014 Healthcare Exchange Consumer Study Results

Proprietary and confidential. Do not distribute.
Prophet’s 2014
Consumer Healthcare
Exchange Survey:
Lessons From Year One &
Opportunities For
Year Two

Proprietary and confidential. Do not distribute.Lessons From Year One & Opportunities For Year Two 1
Prophet’s 2014 Consumer Healthcare Exchange Survey:
Lessons From Year One & Opportunities For Year Two
Reach out to us to learn more about these and other Prophet consumer-focused healthcare initiatives
Jeff Gourdji, Associate Partner
(312) 404-3971
jgourdji@prophet.com
John Kutz, Partner
(415) 359-7383
jkutz@prophet.com
Jeff brings a breadth of experience in marketing, brand and
customer-driven growth strategy that comes from working
across many industries, as marketing practitioner,
management consultant and political strategist. Jeff has
worked in extensively in health care, including payers and
health care service provider organizations.
John has 16 years of consulting experience working with
companies on customer driven strategy and growth projects.
He brings deep experience in healthcare across provider
systems, life sciences, health plans and distribution. He’s
helped several health provider organizations with their
transformation toward more person-centered care models.
Introduction

3Proprietary and confidential. Do not distribute.Lessons From Year One & Opportunities For Year Two 3
We are a strategic brand and
marketing consultancy
About Prophet
We help our clients
win by delivering
inspired and
actionable ideas
Our recognized
thought leaders
and cross-industry
experts work
collaboratively with
clients to create
superior outcomes

We provide a range of
customer-driven solutions
to our clients
We grow
businesses
Companies don't drive
growth – their customers do.
We transform
customer
experiences
Memorable experiences are
flawless, engaging and leave
you feeling surprisingly
satisfied
We build brands
Brand building takes both
strategy and imagination.
About Prophet

Our perspective today is informed
by working across the
health care landscape
Life Sciences
Pharmaceuticals
Devices & Diagnostics
Consumer Health & Wellness
Healthcare Providers
Health Systems and IDNs
Related Healthcare Providers
Payers & Administrators
Insurance Carriers
Other Third-Party Payers
Technology & Operations
Information & Technology
Distribution & Operations
Illustrative and partial client list
About Prophet

Our recent engagements have focused on
understanding the health care consumer and how they
are likely to act in the reform-environment
Consumer Segmentation
Determined consumer needs in the retail
marketplace, and how those needs
grouped into distinct segments
Study Analyses Major Findings
• Less than half of respondents were
primarily motivated by price
• Others were primarily influenced by
access to information, guidance and
support and care related attributes
Consumer Experience Strategy
Development
Examined the healthcare consumer’s
journey to uncover significant painpoints
and opportunities for improvement
A heightened consumer experience revolved around:
• Robust member onboarding program
• An improved digital / mobile experience
• Personalization in member communication
Consumer Trends Exploration
Examined emerging trends in consumer
attitudes and behaviors and determine
applicability to healthcare
Today’s consumers:
• Are concerned with making more considerate choices
• Seek omnipresent connectivity
• Want to track and be rewarded for their progress
About Prophet

As health exchanges and how consumers interacted
with them became a major hot button, we had
a several questions
Survey Background
We set out to understand what
happened in year one and what can be
learned in anticipation for year two:
? • What can we learn from those that signed up for 2014?
• Which groups are ripe to target for 2015
• What will it take to win with them?

We designed our survey to pick up on target
consumer preferences, drivers, and barriers
when engaging with the Exchange
Survey Background
Who did we talk to? Qualifying respondents…
Were over 18
Were the sole decision makers or shared decision making responsibilities
Are any one of the following:
- Purchasers on the exchange,
- Are uninsured and eligible for subsidies,
These respondents are those we believe to resemble the primary
targets for sign up on an exchange
01
02
03

Overall Findings
Avoid the
Stubborn
Subset:
Top headlines for overall sample
Upsell is
Financially
Viable:
The long term uninsured
are a difficult audience for
the Exchange, due to
their dismal future plans
to purchase, and might
not be ripe to target
The Metal type that
respondents purchase did
not indicate a higher
instance of chronic health
condition
Low
Awareness of
Subsidies:
More than half of those who
were eligible for subsidies
on the Exchange were
unaware of their status
Two Key
Groups to
Address Next
OEP:
Millennials & Hispanics
Millennials and Hispanics are
groups with high interest in
the Exchange and should be
targets of interest leading up
to the year two OEP

Overall Findings – Avoid the Stubborn Subset?
Data suggested that the long term uninsured
are a difficult audience for the Exchange,
and might not be ripe to target
Definitely / probably
will buy on the
exchange
Definitely / probably
will not buy on the
exchange
Uninsured for less than 5 years
The “Stubborn Subset”
Uninsured for more than 5 years
3.2: Which of the following statements best
reflects how likely you are to consider purchasing
insurance for yourself or a family member through
the Healthcare Exchange?
32%
-20%
12%
41%
+22%
63%
Only 3% of the “Stubborn Subset” claimed to have had a positive experience on the site.
A potential reason for these poor experiences? Only 17% of them agreed that the Exchange
made it easy to find plans relevant for them

13
Overall Findings – Upsell is Financially Viable
Presence of a chronic
health condition is not highly correlated with
the purchase of more expensive plans
In addition, those with multiple chronic health conditions, did not have higher purchase levels of premium plans
No Chronic Health Condition Has Chronic Health Condition*
Catastrophic 4% 3%
Bronze 25% 19%
Silver 38% 48%
Gold 18% 16%
Platinum 15% 15%
4.2: Which of the following insurance plan levels did you select? (Select one)
Note: Bronze, Silver, Gold and Platinum plans provide the same set of essential health benefits
*Chronic conditions included:
Asthma, Chronic lung disease, emphysema, chronic bronchitis or COPD, Congestive Heart Failure (CHF), Coronary Artery Disease (CAD), High Cholesterol,
High Blood Pressure or Hypertension Diabetes, Hemophilia, Arthritis or Rheumatism Cancer, Chronic Pain including chronic back pain, Multiple sclerosis,
cystic fybrosis, or hemophelia

14
Overall Findings – Low Awareness of Subsidies
More than half of those who were
eligible for subsidies on the Exchange
were unaware of their status
1.10: Do you believe you are eligible to receive discounted rates, or subsidies, to purchase health insurance through the exchange?
The Kaiser Family Foundation estimates that 17 million people who are now uninsured
or who buy insurance on their own are eligible for premium tax credits
Of those actually eligible
Respondent believe they are eligible for subsidies through the Exchange 43%
Respondent believe they are not eligible for subsidies through the Exchange 21%
Respondent is not sure 36%

15
Overall Findings – Two Key Groups to Address Next OEP
Research identified two attractive and
viable groups to target leading up to
the year two OEP
What about these groups,
why do we want them?
Can we even get them? How? The
Independent
Millenials
• Do we want them: Favorable from an actuarial
perspective: healthy, young, and of those who are
uninsured, they have not been for long
• Can we get them: Express that they had very
positive experiences with the exchange so far,
and many claim to be open to future use of the
Exchange
• How do we can get them: Through education
and guidance, specifically around the shopping
experience
• Do we want them: Purchase more expensive
plans, and want to stay with the same HIC long-
term
• Can we get them: Value health insurance and
consider it extremely important, especially for their
families. About half believe that HCR will bring
them greater access to better health benefits.
They also consider the exchange to be an
attractive channel for cost savings
• How do we get them: Through guidance. Many
are confused about how the Exchange works, and
would be open to guidance from HICs
The
Acculturated
Hispanics

Questions?
John Kutz
Partner
(415) 359-7383
jkutz@prophet.com
Jeff Gourdji
Associate Partner
(312) 404-3971
@ProphetBrand
prophet.com/healthcare
Type them in the text box on the right side of your screen

Let’s explore
The Millennial
opportunity

Sampling Information Millennials
Who are the “Millennials”
we talked to?
We disqualified respondents who are covered
under a parent’s insurance plan; therefore,
our sample of Millennials tend to be:
Older
More
independent
More
educated than
the nation’s
population
of 18-34
years old
However, we believe this sample better reflects the target for whom the Exchange was designed.
Due to these nuances, we have consider them “Independent Millennials”

Sampling Information Millennials
The Millennial opportunity
Young,
Stubborn,
but
Interested:
Young, Stubborn, but Interested:
Not surprisingly, Millennials tend to be more disengaged with
their health until they are sick, however, they are generally still
very intent on utilizing the exchange
Unexpected Positivity:
For Millennials, the experience on the exchanges has been far
more positive than older groups, which could indicate a higher
likelihood to purchase in the future
Seek Guidance:
Millennials seek guidance when shopping for plans, and
value that the Exchange lets them easily compare prices of
plans. Right now they seek guidance from friends and family, but
there is an opportunity for payers to come in as expert guides
Unexpected
Positivity
Seek
Guidance:

Despite attitudes that suggest apathy towards
health insurance, Millennials still are interested in
HCR and plan to purchase on the Exchange
Attitude Millennials Non-Millennials
I do not think about my health until I get sick 34% 22%
Compared to other things I spend my money on,
health insurance is not a priority for me
43% 26%
Healthcare reform will give me greater access to better
health benefits in the future
44% 28%
T2B%
Scores
7.4: Using the scale below, please indicate how much you agree or disagree with the following statements that relate to your finances, health care, and making decisions about health insurance coverage?
3.2: Which of the following statements best reflects how likely you are to consider purchasing insurance for yourself or a family member through the Healthcare Exchange?
However…
Young, Stubborn, but Interested Millennials
Definitely / probably will buy
on the exchange
Definitely / probably will not buy
on the exchange
Plan to purchase in the future
44% 21%
28% 57%

Visit experience in detail
Upon visiting needed the exchange site, it was clear to me where I to navigate 64% 41%
The exchange website helped find the right insurance plan for my needs 60% 38%
The exchange website did a good job explaining the benefits of each plan 64% 39%
It was easy for me to compare health insurance plans side-by-side 66% 43%
I did NOT encounter any errors or "bugs" while using the exchange website 52% 35%
Millennials clearly had a more pleasant experience on
the exchange, which we expect to translate to positive
word of mouth and momentum for the second OEP
Unexpected Positivity Millennials
General visit experience on the Exchange:
56%
21%
35%38%
Had a positive experience Had a negative experience
Millennials Non-Millennials
3.8: You mentioned that you [answer from 3.1]. How would you rate your overall experience with using the exchange site?
T2B%
Scores

Overall, 45% of Millennials look for advice
from others when choosing a health insurance plan,
compared to 22% of non-Millennials
Seek Guidance Millennials
Currently, Millennials are disproportionately influenced by social connections and more modern informational outlets
Top sources of Influence or guidance
(Select up to three)45%
24%
23%
16% 16%
15% 15% 15% 15%
13%
12%
10%
44%
32%
11%
20%
18%
5%
12%
9%
7%
18%
8%
19%
0%
10%
20%
30%
40%
50%
Websites
related
specifically to
the
healthcare
exchanges
News articles
or coverage
about the
healthcare
exchanges
My spouse My current
insurance
company,
broker or
agent
My doctor or
healthcare
professional
My parent(s) Other family
members (not
parents)
Information
shared on
social
networking
sites (e.g.,
Facebook,
Twitter)
Work
colleagues
Friends My employer,
HR person or
benefits
specialist
None of the
above
%OfRespondents
3.7: [For those who might or will plan to use Exchange – Sources of influence] Which of the following sources of information
do you plan to rely on for guidance?
Select up to three primary sources of information)
Sources of
Influence

We believe, however, that there is
opportunity for health insurance companies to
provider additional guidance to Millennials
Seek Guidance Millennials
When asked:
“Do you trust health insurance
companies to do the right thing?”
of
Millennials
said
“yes”
of
Non-
Millennials
said“yes”
35% 19%
Because Millennial trust is almost twice that of
older respondents, there may be an opportunity
for these health insurance brands to expand
relationships with them.

These findings are consistent with
Millennial attitudes and needs observable
across other categories
Millennial Trends Millennials
35%
They expect to be able to
seamlessly compare products
/ prices
They seek guidance that is
intuitive and in language they
understand
They desire simplicity with
few restrictions
There is an opportunity to take learnings from brands successful
in catering to Millennials outside of healthcare

Questions?
John Kutz
Partner
(415) 359-7383
jkutz@prophet.com
Jeff Gourdji
Associate Partner
(312) 404-3971
@ProphetBrand

Next, Let’s look at
the Hispanic
opportunity

Sampling Information Hispanics
Who are the “Hispanics”
we talked to?
We deliberately targeted a sample of Hispanic respondents that were
inherently more acculturated than the nation’s populations of Hispanics.
Our sample tends to be:
More educated Wealthier
Slightly younger
than the nation’s
populations of
Hispanics
Our findings on Hispanics cannot be blanketed over the entire population,
but describe a large subset of more acculturated Hispanics.
Due to these nuances, we should consider them “Acculturated Hispanics”

Sampling Information Hispanics
The Hispanic opportunity
Advocates for
Health
Insurance:
Advocates for Health
Insurance:
Hispanics are very
enthusiastic about health
insurance, valuing its
importance highly for
themselves, and especially
for their families
Open-minded
Positivity:
Open-minded Positivity:
Hispanics are more likely
to have positive
experiences than non-
Hispanics when visiting the
Exchange, and are more
open to the idea of using it
to purchase in the future
Enthusiasm
Not
Translating:
Enthusiasm Not
Translating:
Higher levels of enthusiasm,
however have not
translated to higher
purchase on the Exchange
compared to non-Hispanics –
with both purchasing
behaviors on par with one
another
Opportunity
for Guidance
and Clarity:
Opportunity for Guidance
and Clarity:
Hispanics disproportionally
seek out assistance from
a range of sources due to
high confusion in the plan
selection process –
therefore, there is an
opportunity to educate and
guide Hispanics on the
plan selection process and
the program in general

Hispanics consider health insurance to be
much more important than their counterparts,
especially for their families
Advocates for Health Insurance Hispanics
…For Themselves …For their Family
Hispanics Non-Hispanics Hispanics Non-Hispanics
Extremely Important 38% 32% 51% 43%
Very important 38% 31% 30% 30%
Somewhat Important 17% 22% 15% 23%
Importance of
health insurance
7.3: [Ask only if have other family members in Q 1.2/1.3] And how important is it to you to have health insurance coverage for your family members?
7.2: Overall, how important is it to you to have health insurance coverage for yourself, personally?
97% of Hispanics see health insurance
as at least somewhat important for their families
making them an approachable and willing population
to target with emotional marketing

Hispanics also had generally positive
experiences on the exchange, which could
lead to high levels of future purchase
Open-minded Positivity Hispanics
General visit experience on the Exchange:
52%
20%
40%
35%
Had a positive experience Had a negative experience
Hispanics Non-Hispanics
3.8: You mentioned that you [answer from 3.1]. How would you rate your overall experience with using the exchange site?
Definitely / probably will buy
on the exchange
Definitely / probably will not buy
on the exchange
Plan to purchase in the future
46% 26%
28% 51%

3.1: In what ways have you interacted with the Healthcare Marketplace Exchange? (Select all that apply)
Level of Interaction with the Exchange Hispanics Non-Hispanics
Enrolled through the Exchange 28% 26%
Created an account on the Exchange but did NOT enroll 19% 21%
Visited the Exchange but did NOT create an account or enroll 24% 20%
Did NOT visit the Exchange 33% 38%
This gap between enthusiasm for the Exchange
and actual enrollment signals Hispanics as
a key year 2 OEP target
Despite these high levels of optimism,
Hispanics did not enroll at significantly higher
rates vs. Non-Hispanics in the first OEP
Enthusiasm Not Translating Hispanics

One major barrier to Hispanic
enrollment is confusion around how
the Exchange works
Opportunity for Guidance and Clarity Hispanics
We tested for the highest barriers of
enrollment on the exchange and
found that:
of
Hispanics
claim that
they “don’t
really
understand
how the
program
works”
of
Non-
Hispanics
claim that
they “don’t
really
understand
how the
program
works”
24% 9%

There may be an opportunity for health insurance
brands to fill this information gap and expand
their relationships with Hispanics
of
Hispanics38%
of
Non-
Hispanics
22%
Trust health insurance
companies to do the
right thing
of
Hispanics38%
of
Non-
Hispanics
28%
Would never consider
buying a health plan
that was offered by
the government
While the government has traditionally supplied information and education regarding
the Exchange, they are less trusted by Hispanics – there may be an opportunity for
health insurance companies to be the trusted source for guidance

44%
24%
23%
20%
19%
18%
17%
15%
11%
10%
8%
6%
44%
16%
30%
15%
19%
15%
8% 8%
13%
16%
13%
10%
0%
10%
20%
30%
40%
50%
Websites
related
specifically to
the
healthcare
exchanges
My doctor or
healthcare
professional
News articles
or coverage
about the
healthcare
exchanges
My spouse My current
insurance
company,
broker or
agent
Friends Work
colleagues
My employer,
HR person or
benefits
specialist
Other family
members (not
parents)
None of the
above
Information
shared on
social
networking
sites (e.g.,
Facebook,
Twitter)
My parent(s)
Overall, 45% of Hispanics look for advice
from others when choosing a health insurance plan,
compared to 26% of non-Hispanics
Currently, Hispanics are disproportionately influenced by experts–such as providers, plan sponsors, and their employers–
when it comes to healthcare
Top sources of Influence or guidance
(Select up to three)
%OfRespondents
3.7: [For those who might or will plan to use Exchange – Sources of influence] Which of the following sources of information
do you plan to rely on for guidance?
Select up to three primary sources of information)
Sources of
Influence

These findings are consistent with
Hispanic attitudes and needs observable
across other categories
Hispanic Trends Hispanics
35%
They seek mobile-enabled
connections
They are extremely brand loyal,
especially during acculturation
process
They are strongly
“family-centric”
There is an opportunity to take learnings from brands successful
in catering to Hispanics outside of healthcare

Questions?
John Kutz
Partner
(415) 359-7383
jkutz@prophet.com
Jeff Gourdji
Associate Partner
(312) 404-3971
@ProphetBrand

Prophet 2014 Healthcare Exchange Consumer Study Results

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