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Health Services Research & Development

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Early Experiences of Michigan’s Medicaid Expansion Beneficiaries with Cost-Sharing and Financial Incentives for Healthy Behaviors

Kieffer E, Scherer A, Kullgren JT, Clark S, Rowe Z, Beathard E, Olorode T, Szymecko L, Zamora MV, Solway E, Ayanian J, Goold S. Early Experiences of Michigan’s Medicaid Expansion Beneficiaries with Cost-Sharing and Financial Incentives for Healthy Behaviors. Poster session presented at: Society of General Internal Medicine Annual Meeting; 2016 May 11; Hollywood, FL.

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Background. Michigan is among the earliest of seven states to have received a CMS-approved waiver allowing demonstrations of alternative approaches to Medicaid expansion. Michigan's Healthy Michigan Plan (HMP) features cost-sharing tied to income level, with opportunities to reduce cost-sharing by completing a Health Risk Assessment (HRA) and documenting intention to engage in healthy behaviors. There is little research regarding Medicaid beneficiaries' experiences with these novel benefit designs, and their impact on beneficiaries' behaviors. This study presents insight into beneficiaries' perceptions of, and reaction and responses to, cost sharing and financial incentives for healthy behaviors. Methods. We conducted in-depth cognitive interviews with 32 HMP beneficiaries from five Michigan regions: 13 with incomes 100% FPL requiring both copays for services and contributions (like premiums); 9 with incomes at 35-99% FPL requiring only copays for services; and 10 with incomes < 35% FPL with no required cost-sharing requirements. Data were recorded, transcribed verbatim and coded using Dedoose qualitative analysis software. Major themes and illustrative quotes were retrieved for analysis. Results. Many beneficiaries perceived their required cost-sharing to be fair and affordable. Some commented on their sense of responsibility for paying a share of the cost of health care. Required payments seemed reasonable, even to those with higher cost-sharing requirements, particularly in relation to the benefits received. Most were relieved that required payments were relatively small. Although most reported they had already paid or intended to pay, a few beneficiaries found payments unaffordable or difficult due to competing financial demands. Most beneficiaries were unfamiliar or unsure about the financial incentives for healthy behaviors and did not make the connection between completing the HRA and earning a financial incentive. Rather, the desire to be healthy, or to get needed health care was the primary reasons beneficiaries gave for engaging in health behaviors. Many beneficiaries reported participating in screening and assessment with a primary care provider; many had received immunizations, new diagnoses and related treatment. Conclusions. HMP beneficiaries with cost-sharing requirements generally found payments fair and affordable but rarely understood the connection between adopting a behavior change goal and financial incentives. Diverse methods to increase beneficiary awareness and understanding of financial incentives for healthy behaviors may increase their effectiveness. Use of videos, social media and in-person review with community health workers or navigators may increase understanding of written materials, especially with beneficiaries with low educational levels or low health literacy. Many states have implemented or are considering Medicaid expansions that feature higher cost-sharing and incentives for healthy behaviors. This study provides one of the first glimpses into beneficiaries' initial reactions and responses to these novel benefit designs. Follow up and larger-scale evaluation of this and other recent Medicaid expansions is needed to ascertain whether, with longer-term experience, beneficiaries continue to perceive cost-sharing as fair and affordable, and whether they better understand and are motivated by financial incentives to engage in healthy behaviors.

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