A new study published in JAMA Health Forum finds that people often flee Medicare Advantage plans and enroll in traditional Medicare when they develop complex conditions. The findings corroborate an early finding from researchers at Brown University that people with serious health needs are more likely to disenroll from Medicare Advantage plans. Kimberly Marselas and Foster Stubbs report for McKnights on the Medicare Advantage insurers’ failure to provide the complex and long-term care people need.
Medicare Advantage plans tend not to invest in long-term care. It’s expensive and eats into their profits. Because they are paid a flat fee per enrollee, they profit more if costly enrollees disenroll. Many enrollees switch to traditional Medicare, in order to get the care they need without delay or bureaucratic hassle.
But, many enrollees are locked into Medicare Advantage. If they don’t have Medicaid or other coverage, they can’t switch to traditional Medicare without assuming high out-of-pocket costs. Traditional Medicare lacks an out-of-pocket cap. Supplemental coverage to protect them against financial risk is often unavailable and, even when they can buy it, it’s often unaffordable.
The solution is not to lock people into Medicare Advantage for longer as the researchers suggest. Rather, lawmakers should recognize that Medicare Advantage does not and has never achieved the goal of limiting Medicare spending growth or delivering the care people need. Forcing people to remain longer in a Medicare Advantage plan will not change insurers’ financial disincentive to provide costly care to people with complex conditions. And, it will hurt enrollees.
Without any evidence, Sachin Jain, MD, president of SCAN Health Plan suggests that locking people into a Medicare Advantage plan for longer might encourage insurers to invest in long-term care. More likely, it would lead to tens of thousands more premature deaths in Medicare Advantage. So, long as long-term care costs eat into insurer profits, it’s hard to imagine insurers will invest in it.
Enrollees could suffer tremendously if locked into their Medicare Advantage plan for more than a year. Medicare Advantage plans are constantly changing their provider networks and prior authorization rules. They also can and do generally raise enrollee costs from one year to the next.
The researchers at Johns Hopkins studied one million Medicare Advantage enrollees who developed serious medical conditions, including heart attacks, Alzheimer’s, kidney disease, lung disease, stroke and depression. More than one in three of these enrollees with four or more new complex conditions left their Medicare Advantage plans in the next year.
Three in ten enrollees with three new complex conditions left their Medicare Advantage plans, as did more than one in four enrollees with two next complex conditions. And, one in six enrollees with one new complex condition left.
This data reveals how little value there is in Medicare Advantage for the small percentage of people with Medicare who are responsible for the vast majority of Medicare spending. That’s why I call Medicare Advantage value-less care.
As Jain acknowledges, the fact that people can leave creates a disincentive for the Medicare Advantage insurers to invest in preventive care, continuity of care and long-term care. What he doesn’t say is that the defective Medicare Advantage payment system also creates that disincentive, as the MA insurers profit more the less care they cover.
Here’s more from Just Care:
- People with serious health needs more likely to disenroll from Medicare Advantage plans
- Medicare Advantage doesn’t work for rural Americans
- The many disadvantages of Medicare Advantage
- Need costly care in Medicare Advantage? Expect a denial
- Seven reasons commercial insurance cannot meet our health care needs
