|Title||Medicare Supplemental Insurance Purchasing Decisions and Ownership|
|Year of Publication||2007|
|University||Case Western Reserve University|
The majority of Medicare beneficiaries rely on supplemental insurance to help fill the gaps in Medicare's benefit package and to protect themselves from large, unanticipated health care expenses. Medigap is the only supplemental insurance available to all beneficiaries in the private health insurance market. Although numerous studies have been conducted on Medigap ownership, few attempts have been made to explore the decision-making process for purchasing Medigap. This dissertation examined decision factors in the dynamics of private supplemental insurance purchases by Medicare beneficiaries. Simon's Bounded Rationality Theory was utilized to develop a conceptual framework for this study. This study is a secondary analysis, using longitudinal data from the Asset and Health Dynamics Among the Oldest-Old Survey (AHEAD). The sample consisted of 2,756 non-Hispanic Medicare beneficiaries who had Medicare coverage and were 70 and over at the 1993 baseline interview. This sample was followed at Wave II and Wave III in the 1995 and 1998 surveys. Multilevel modeling was used to examine the time-dependent relationship of the Medigap purchasing decision. The analysis revealed that for the oldest old, Medigap purchases were related to socio-demographic and economic factors, while limited by cognitive functioning and influenced by environmental factors. Beneficiaries with Medigap coverage are better educated, more likely to be white and financially advantaged, and more likely to have better cognitive functioning. However, the beneficiaries' need for services---self-reported health status and chronic disease conditions---was not found to have impact on Medigap purchases. The findings of this study have implications for Medicare policies that are designed to enhance health care coverage while containing health care costs through market competition. These findings are also important for public agencies and other entities helping the disadvantaged elderly make informed enrollment decisions, and for furthering empirical knowledge and research methodology on the behavioral modeling with respect to health insurance purchases.
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|Short Title||Medicare Supplemental Insurance Purchasing Decisions and Ownership|