Why did so few Iowa Medicaid members participate in the state’s incentive program?

Under Iowa’s Affordable Care Act Medicaid expansion, the state designed a program that offers incentives to enrollees to complete healthy activities.

For example, in exchange for completing an annual physical and risk assessment, some plan members wouldn’t have to pay the $5 to $10 monthly health insurance contribution required by the state the following year.

The goal was to encourage newly insured Medicaid members to start receiving preventative care, lured by the “carrot” of saving money in the process.

The trouble was, it didn’t work. About 17 percent of the 64,600 people enrolled in the Wellness Plan completed both of these healthy activities in 2014, the program’s first year, according to researchers who published new findings in a recent Health Affairs article.

The Iowa program’s struggles raises new questions about Medicaid incentive programs and whether shifting more responsibility to members can work, according to study authors Natoshia Askelson, Brad Wright, Suzanne Bentler, Elizabeth T. Momany and Peter Damiano. It also underscores how incentive programs that include premiums can exacerbate existing disparities in access to care. One of the larger themes from the Iowa study is just how little researchers understand about newly insured Medicaid enrollees.

“We are all frantically trying to understand who these people are, what’s their experience, what their health look like, what needs to happen to motivate or incentivize them,” said Askelson, an assistant professor at the University of Iowa and a behavioral scientist with an emphasis in health communication. “They’re not people who have been on traditional Medicaid or private insurance. They’re the people who have fallen through cracks.”

Why didn’t Iowa’s program work?

We asked Askelson to find out why she thinks people didn’t participate, and what lessons the Iowa waiver holds for similar programs. Was the low participation rate in the incentive program  related to flaws in how it was designed, or was saving $5 to $10 in monthly premiums simply not worth the time and effort involved?

Answering that question isn’t so simple, Askelson said.

When researchers interviewed members and clinic managers, they found few people were even aware of the program. “If you’re going to do some kind of incentive program, you really need to work hard at developing awareness,” she said.  

There were some outreach efforts, including a website, mailings and webinars. But this population — people who now receive Medicaid thanks to the ACA’s expansion — tend to have lower levels of literacy and are more transient, she said.

“It’s a group that it is really hard to communicate with,” she said. “Your general modes won’t be as effective.”

Even among the people who did participate, researchers aren’t sure if they even intended to.  It’s possible, for example, that they just went in for a regular check-up and filled out the form at the provider’s prompting. (The program also included financial incentives for providers who helped members complete their health risk assessment forms.)

"If you’re going to do some kind of incentive program, you really need to work hard at developing awareness." — Prof. Natoshia Askelson, University of Iowa

Along with a lack of awareness, researchers found that some people couldn’t find an available appointment or a provider who accepted their plan. Others had trouble finding the time or transportation to get there. 

There were some trends in who participated and who didn’t. The study found that people “who are younger, are non-white, live in nonmetropolitan areas, and visit the ED more often are especially at risk of failing to complete the wellness exam and health risk assessment.”

Incentives programs often don’t work as intended

Creating incentives that encourage people to get preventative care in Medicaid is “a relatively new experiment,” the study’s authors say. Previous efforts that focused on employer-sponsored insurance saw mixed success.

Still, there are some universal psychological insights that can help researchers understand how human beings make decisions. For example, in order for rewards or punishments to be effective, they need to occur close in time to the desired action. In this case, the “penalty” of having to pay the monthly premium fees didn’t happen until the following year, Askelson pointed out.

In general, incentives tend to be most effective in getting people to do something once — such as a preventative health visit or a vaccine — but less effective in sustaining behaviors such as exercising or eating healthier. Bringing about long-term changes requires adding the tools needed to achieve a particular goal, such as increasing access to healthy foods. The challenge, though, is that those large-scale changes aren’t easy to achieve with a health insurance program.

Researchers like Askelson are still delving into the data and trying to get a better sense of these new Medicaid beneficiaries. Among the topics they’re still investigating: What happens to Medicaid members who don’t participate in the Healthy Behaviors Program? Do they end up just paying the extra cost the next year or do they get kicked off the Medicaid rolls? What happens to their health if they lose it? 

The Kaiser Family Foundation has compiled an issues brief detailing the effects of premiums and cost sharing in Medicaid, finding that even relatively small levels of cost sharing can reduce access to care, especially for those with at the lowest income levels.

There is one very strong take-away from the Iowa experience: The communication channels used so far didn’t reach enough people, Askelson said.

“This is a group who does not have a lot of experience with insurance and the health system,” she said. “We need to help them navigate a system they don’t understand.” 

 [Photo: Scott Olson/Getty Images]