Reversing a Trend, Sicker Americans Are Staying With Medicare Managed Care Plans
A new study shows that older Americans with health issues are now staying with their Medicare Advantage managed plans, rather than swapping them for traditional plans through a health insurer.
Although Medicare Advantage has been criticized in the past for “cherry-picking” healthy patients, that's no longer the case, according to the research.
"This is not what a lot of people would expect, based on what we've seen with Medicare managed care plans historically,” said senior study author Wendy Xu, an associate professor at Ohio State University's College of Public Health.
The study doesn't seem to support the premise that people become unhappy with care access in the managed plans when they become sicker, Xu noted.
“Twenty or 30 years ago, it used to be that people who develop chronic conditions switch back to traditional Medicare like crazy -- but in our study, the switch-back rate was very low,” she said in a university news release.
The managed care plans for those 65 and up are run by private insurance companies. An approved network of health care providers negotiate service rates with the companies, which is different from the traditional Medicare model where someone can see any caregiver who participates in Medicare.
“These plans work with providers to get better rates for their members, so it's a little more controlled and it also allows for other benefits that you can't get through traditional Medicare, such as dental care,” said lead study author Eli Raver, a doctoral student at Ohio State's College of Public Health.
“It tends to have lower premiums and be a bit more coordinated, with an emphasis on the role of primary care, and one of the extra benefits is disease management for multiple conditions, an approach that benefits many aging Americans,” Raver said in the release.
In the study, the researchers examined Medicare enrollment data from almost 45,000 enrollees from 2009-2019, when an increasing number of people were opting for Medicare Advantage's managed care options.
The study found that about half of Medicare beneficiaries are covered under Medicare Advantage plans. That percentage is growing, Xu added.
“When this model was first created, there was a clear incentive for providers to skimp on health services, and gravitate toward healthier, younger patients. So, the ‘cherry-picking' criticism was valid,” Xu said.
But changes to the system have led to better compensation for providers who care for those with complex, chronic conditions.
"These plans have started to enroll a larger proportion of lower-income and minority groups and even people with multiple chronic conditions, and the Medicare program gives them incentives to do that,” Xu explained.
Lower-income Americans, a vulnerable population, were seen to be an exception.
“We found that they do have a higher rate of switching from Medicare Advantage to traditional Medicare than non-dual-eligible enrollees,” Raver said.
"These plans appear to serve older Americans reasonably well based on our study, but for those with multiple chronic conditions who are also poor, and for those with disabilities, there could be some concerns about whether Medicare Advantage is providing enough access to care,” Raver noted.
The findings were published online June 26 in the Journal of the American Medical Association.
The U.S. Centers for Disease Control and Prevention has more on keeping older adults healthy.
SOURCE: Ohio State University, news release, June 26, 2023