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More Medicare Advantage Research

By April 14, 2024Commentary

The health plan arm of Medicare, Medicare Advantage, is at a crossroads.  The program now covers the majority of beneficiaries, and while growth may slow, it will continue and a higher percent of people will be enrolled.  Payments to the health plans have been controversial and Medicare has recently clamped down on questionable practices and indicated a no or low payment increase for next year, providing more turmoil.  This article looked at switching rates from fee-for-service Medicare to Medicare Advantage, and vice versa, in the period 2006 to 2022.  It found that the rate of people switching from fee-for-service to a health plan more than tripled over this time, which the rate of people going from a health plan back to fee-for-service Medicare declined.  The sustained nature of this shift suggests that beneficiaries have learned about and come to appreciate the lower costs and extra benefits associated with Medicare Advantage.  (HA Article)

The second article bears on how MA plans make money.  The headline is by reducing hospitalizations, for some conditions.  The difference in utilization patterns between fee-for-service Medicare and MA depends on the disease being treated.  Heart attack patients, wwho have the highest total resource use, showed little difference between the two Medicare types, probably because a heart attack almost certainly requires hospitalization.  The largest difference was in regard to chronic kidney disease, likely because MA plans focus on ensuring that patients get dialysis and other treatments that avoid hospitalizations.

MA plans interestingly have higher rates of use of testing and imaging across all conditions.  This is likely because the plans are interested in fast and accurate diagnoses that permit treatment at an early stage which can avoid hospitalizations.  What the article did not look at was primary care use.  If it had, it likely would have seen higher rates of use in MA, because that also helps keep patients out of the hospital.  The the lower use of hospitalization is likely also reflected in better quality outcomes for patients, which multiple pieces of research have reported in regard to MA.  (HA Article)


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