Simplifying The Medicare Plan Finder Tool May Increase Its Usability

September 20, 2018

The Medicare Prescription Drug Program (Part D) significantly increased Medicare beneficiaries’ access to prescription drug coverage and lowered their out-of-pocket spending on prescription drugs. However, the program still faces the challenge of helping older adults make good plan choices- estimates suggest that, on average, enrollees overspend on their coverage by about 30%. The Centers for Medicare and Medicaid Services (CMS) provides an internet-based decision support tool called Plan Finder to assist older adults in their choices; yet this tool has proven to be complex and difficult to understand.

Postdoctoral fellow in health economics and policy at Harvard medical school Brian E. McGarry, PhD, Nicole Maestas, PhD, associate professor for health care policy, and David C. Grabowski, PhD, professor of health care policy, take a look at how the Plan Finder could be simplified in a study published in Health Affairs.

Plan Finder attempts to help enrollees choose low cost Part D plans by providing a personalized total cost estimate for each available plan, but this information my get lost when presented alongside potentially complicated plan details like premiums, deductibles, cost sharing amounts, and formulary design. Using a randomized experiment conducted in a nationally representative sample of older adults, McGarry, Maestas, and Grabowski examine  how changes to the current Plan Finder design, which remove financial details and increase emphasis on the total cost estimate, affect people’s ability to choose low cost plans. They find that simplifying the menu in this way leads people to select lower cost plans without changing user satisfaction with the tool or the average quality of plans chosen. Based on their results, the authors suggest that financial information on the default Plan Finder menu be modified so that only  total cost estimate are shown, or that total costs be presented alongside plan premiums and estimated out-of-pocket costs. These changes may be an easy, low-cost approach to easing customer woes with the Plan Finder tool, and increasing its usability.