Deft’s 2007 National Senior Loyalty Study uses highly regarded loyalty metrics, like Net Promoter Score or NPS, to measure the loyalty of seniors to drug coverage plans. Deft’s research findings about loyalty and drug coverage link these important topics to consumer intention to switch coverage and market differences among senior drug coverage plans.

Drug Coverage Top Line Result

Declining drug coverage NPS is one of the findings outlined in the current study. Drug Coverage NPS for 2006 was 19%, while this year’s NPS is at -4%. Much of this decline can be accounted for by the falling scores of a few large firms. Together, Humana, AARP, United Healthcare, and Anthem account for 58% of the Drug Coverage NPS drop.

Sources of Decline in Drug Coverage NPS

source: Deft Research, LLC

How Do Deft’s Clients Use This Research?

First they review the Advance Prospectus and fax back the order form.

The research is delivered within one business day. Loyalty and switch intention are shown to be related to several market perceptions and benefit design attributes. The report provides clear direction for all of your employees: reach out to Detractors, teach Passively Satisfied about value, engage Promoters. The report will help you:

• build your brand around the key perceptions of Promoters;
• train call center employees on the aspects of loyalty and switch;
• identify and reach out to customers at-risk for switching;
• design 2008 products and services that leverage your strengths and competitors’ weaknesses.

Trend Tracking

Deft’s 2007 National Senior Loyalty Study uses the highly regarded Net Promoter Score (NPS) to measure the loyalty of seniors to health plans. Deft’s 2006 research showed that NPS was closely linked to consumer intention to switch and perception of market differences among senior health plans.

Comparing data from 2006, the 2007 study shows that the industry’s NPS has declined from 33% to 26%. Much of the decline is accounted for by AARP, Anthem, and Humana. In 2006, these firms combined for an NPS of 53%, well above average. But in 2007 their combined NPS dropped to 27%. Despite loosing ground, AARP retains an NPS that is still higher than average, while Anthem and Humana’s NPS are now below average.

Changes in Senior Health Insurance Net Promoter Scores

source: Deft Research, LLC

Below is a list of companies whose NPS’s and market positions are reported:

• United Healthcare
• AARP
• Anthem
• Aetna
• Humana
• Kaiser
• CIGNA
• Coventry
• Health Net
• Universal American Financial Corp.
• Horizon BCBS
• Highmark BCBS
• and 21 other BCBS and regional plans

Deft’s 2007 National Senior Loyalty Study uses highly regarded loyalty metrics to measure the loyalty of seniors to health plans. Deft’s 2007 research showed that loyalty to a health plan holds seniors in a “no intention to switch” attitude.

How Do Deft’s Clients Use This Research?

First they review the Advance Prospectus and fax back the order form.

Loyalty and switch intention are shown to be related to several market perceptions and benefit design attributes. The report provides clear direction for all of your employees: reach out to Detractors, teach Passively Satisfied about value, engage Promoters.

Some ideas:

• build your brand around the key perceptions of Promoters;
• do call center training on the aspects of loyalty and switch;
• identify and reach out to customers at-risk for switching;
• design 2008 products and services that leverage your strengths and competitors’ weaknesses.

Big Value

Customers exhibiting more loyalty to their health plan are considered Promoters while those exhibiting less loyalty to their health plan are Detractors. When the switch intention of these groups is compared, only 13% of Promoters are considering a health plan switch while 44% of Detractors are considering it. Detractors are four times more likely to consider a health plan switch.

Promoters’ and Detractors’ Switch Intention

source: Deft Research, LLC

2007 National Senior Loyalty Study

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TABLE OF CONTENTS

• Executive Summary
• Overview and Background
• Senior Loyalty — Medical and Drug Coverage
• Senior Switch Intention — Medical and Drug Coverage
• Perceptions of Market Differentiation
• Predicting Switch Intention Using Benefit Attributes and Service Usage
• Conclusions
• Company Profiles