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EXECUTIVE RESEARCH BRIEF
2016 AGE-IN STUDY
MARKETING TO MEDICARE AGE-INS: INTERNET AND DIRECT MAIL TRENDS
Deft Research’s 11th annual Age-in Study was published in June of
2016. The survey captures the attitudes and preferences of 64-year
olds as they approach Medicare enrollment. The report is designed
to help health plans and marketers develop specific strategies,
tailor messaging, design products to meet the needs of those first
entering Medicare, and plan engagement activities at the right
times of the year.
USE OF CHANNELS FOR SHOPPING
Direct Mail
39%
46%
38%
27%
12%
KEY OBSERVATION #1
Consumers coming to Medicare from the Individual Market now
make up the majority of new Age-in enrollees. The growth of the
Individual Market has created a division in the Age-in market based
on a consumer’s likelihood to enroll in Medicare upon turning 65.
According to the study, 2-in-3 consumers with Employer-Sponsored
Insurance (ESI) plan to enroll in Medicare at 65, compared with
95% of Age-ins from the Individual Market who intend to enroll.
This high rate of Individual Market conversion contributes to our
estimate that more than 50% of new Medicare enrollees will come
from the Individual Market.
CURRENT SOURCE OF COVERAGE BY PRODUCT PREFERENCE
Base: Plan to Enroll in Medicare at 65
ESI
Individual Market
Medicare Advantage
10 to 12 7 to 9 4 to 6 0 to 3 -­-­-­-­-­-­-­-­-­-­-­-­-­-­-­-­Months before 65th Birthday-­-­-­-­-­-­-­-­-­-­-­-­-­-­-­-­-­-­
SOURCE: Deft Research, Age-in Study, June 2016.
The implication of the chart above is that by the time direct mailers
begin sending their largest volumes, the market will have been
“pre-conditioned” by what can be found online. Conclusions will
have been reached, and preferences established. In many cases,
direct mail will arrive in Age-ins’ mailboxes too late to be
persuasive. In an already rich information environment, direct
mail’s message has to offer personal assistance, sources of advice,
opportunities to learn, or some other value that online information
won’t provide.
KEY OBSERVATION #3
53%
50%
Direct mail motivates many consumers to visit websites. Even
though most internet users said they found websites on their own,
direct mail was the top promotional vehicle for driving consumers
to websites. Mail drove three times more visitors to websites than
Internet or TV advertisements.
42%
MedSupp
SOURCE: Deft Research, Age-in Study, June 2016.
According to the study, nearly 40% of all Age-ins currently purchase
individual coverage, and will likely account for more than 50%
of new Medicare sales. If this group can be targeted, individually
insured 64 year-olds could represent a built-in “lift” for Age-in
marketers.
KEY OBSERVATION #2
47%
41%
Below is a thread of observations that build to a conclusion about
direct mail and internet use among Age-ins.
45%
44%
Internet
Here is an instance of direct mail offering a value that may have
been missed by Internet do-it-yourselfers—the health plan’s
website and the facilities it provides. This is also an opportunity for
health plans to send targeted populations to different websites.
According the the study, the most likely visitor to a health plan’s
website is a more sophisticated consumer than others (gauged by
education, income, and health insurance literacy), and perhaps
could be the target. Or, perhaps different websites can be
developed for different levels of health insurance literacy.
CONCLUSION
Internet shopping rates have surpassed the rates of all other
shopping activities. Internet activity is the most prevalent
shopping activity among Age-ins in 2016 and the activity they
spend the most time doing. Rates of internet activity remain steady
throughout the 12 months prior to the 65th birthday. In any given
month prior to age 65, a predictable and consistent percentage of
Age-ins (40-45%) are using the internet to shop for health
insurance. In contrast, direct mail and other channels are subject
to the promotional schedules and budgets of insurers, and so rates
of use are not as steady.
The study is a continuation that confirms but also adds to our 11
years of observations about marketing Medicare plans to Age-ins.
It reinforces the notion that in an optimized marketing mix, the
channels work together so that the preferences of consumers are
always being addressed. But, for the first time—and coinciding
with the growth of the Individual Market—we find evidence that
internet shopping has moved past other channels as the most
frequent activity utilized by Age-ins.
CONTINUED ON PAGE 2
2016 Age-in Study
Deft Research, LLC. All Rights Reserved.
SMIS.
SENIOR MARKET INTELLIGENCE SERVICE
ERB
Most frequent, but not foremost. If marketers are to reach the bulk
of their Age-ins, other channels have to remain deployed. Only
their function is likely to evolve. Direct mail and other channels
may no longer be as effective as they once were as introductions
and announcements. Their better purpose may be to offer unique
shopping values—advice, assistance, and opportunities to targeted
populations.
ABOUT THE RESEARCH
Deft Research’s 11th annual Age-in Study was published in June of
2016. It is the second report in our annual 3-part Medicare research
series, SENIOR MARKET INTELLIGENCE SERVICE.
The study captures the preferences and attitudes of 64 year-olds as
they approach Medicare enrollment as well as seniors who are
Late-to-Medicare. The report is designed to help our health plan
clients and their marketing agencies develop specific strategies,
tailor messaging, design products to meet the needs of those first
entering Medicare, and plan their engagement activities at the right
times of the year.
WHAT IS THE SENIOR MARKET INTELLIGENCE SERVICE?
Deft’s SENIOR MARKET INTELLIGENCE SERVICE is an annual 3-part Medicare
research subscription designed to provide clients with high-quality,
affordable market and consumer insights.
Managers at the nation’s leading health plans and agencies rely on
Deft’s piercing insights and expert consultation to assist with their
marketing, product development, new member acquisition, and
retention strategies.
The 2016 studies and subscription enhancements include:
Senior Shopping And Switching Study (Feb 2016)
☐ National Benchmark Report
☐ Local Market Oversample (General population)
☐ Marketer’s Planning Tool
☐ Member Acquisition Models
☐ Benefit Design Trade-off Service
Age-in Study (June 2016)
The study is based on the responses of:
• 1450 Age-ins: 64 to 65 + 3 months, not enrolled in Medicare
• 153 Late-to-Medicare: 65 + 4 months to 68, not enrolled in
Medicare
• 656 Re-Contacts: Age-in or Late-to-Medicare respondents from
our 2015 Age-in survey.
The survey excluded seniors who recieve health benefits through
TRICARE or Medicaid.
☐ National Report
☐ Benefit Design Trade-off Service
Medicare Member Experience Study (Sept 2016)
☐ National Benchmark Report
☐ Local Market Oversample (General population)
☐ Member Study (sample of your plan members)
☐ Member Retention Models
Data for the study was collected online between May 17, 2016 and
June 2, 2016.
Table of Contents
Study Overview
3
Glossary of Key Terms
4
Pre-Medicare Insurance Coverage
5
Medicare Health Insurance Literacy
11
Likely Plan Enrollment
21
Indicators of Product Preference
27
Information and Resources Used in Decision Making
39
The Shopping Process
52
Late-to-Medicare Seniors
66
Deft Research is the health insurance industry’s trusted source for relevant market and consumer information. We
are committed to helping our clients identify opportunities for innovation, and better service and communicate with
their members. Our research and guidance supports the nation’s top healthcare brands in making more confident
business plans and decisions.
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