In a non-evidence based piece on payments to Medicare Advantage plans, which cost substantially more per enrollee than traditional Medicare, the Commonwealth Fund reported on the views of five experts. Shockingly, none of them talked about the need to end the tens of billions of dollars in overpayments to Medicare Advantage plans. However, they saw the need for a more competitive and equitable payment system for Medicare Advantage.

The experts did not agree on how to fix the payment system to address “inefficiencies” and to be more equitable and comprehensive. One expert believed that across the board cuts to Medicare Advantage should be as little as two percent, as MedPAC has suggested. Another expert saw value in a four percent reduction.

Some of the experts suggested that payment cuts might not be warranted. None mentioned the need to address the more than $100 billion in Medicare Advantage plan overpayments to date or the $600 billion in overpayments to Medicare Advantage projected over the next eight years. The payment system, which allows plans to “upcode” to generate higher capitated rates, is responsible for these overpayments.

Some experts appear to value Medicare Advantage as a tool to achieve greater “efficiency,” seemingly irrespective of whether efficiency delivers poor health outcomes. The evidence suggests that lower spending on medical care in Medicare Advantage plans is in part attributable to inappropriate delays and denials of care and coverage as well as financial and administrative barriers to needed care. The evidence also suggests that Medicare Advantage plans offer care from lower-value providers to people in poor health than traditional Medicare.

The Commonwealth Fund experts were silent on a number of key issues relevant to the Medicare Advantage payment system. They did not speak to the issue of Medicare Advantage plans being rewarded with substantial rebate amounts for spending less on medical care, even if they were denying medically necessary care and delivering poor health outcomes.

Not one expert signaled a need for greater transparency and accountability in Medicare Advantage as a critical window into to the payment system. No expert addressed MedPAC’s lack of ability to assess quality in Medicare Advantage plans because of the plans’ failure to release complete and accurate encounter data. Nor did any expert mention the lack of meaningful data to distinguish one Medicare Advantage from another.

MedPAC recognizes that the payment system should be tied to meaningful quality assessments in Medicare Advantage plans and that Medicare’s star-rating system is not an accurate measure of quality.

The experts mentioned the need to understand how Medicare Advantage plans spend money on additional benefits. At least some of them recognized that a lot of the money available for additional benefits may be adding to Medicare Advantage plan profits more than helping people with Medicare.

Here’s where every expert should stand on Medicare Advantage payments:

  • Medicare Advantage plans should not be overpaid. Overpayments are driving up Medicare spending, eating into the Medicare Trust Fund and unleveling the playing field between Medicare Advantage plans and traditional Medicare.
  • The payment system should not reward Medicare Advantage plans that are delivering poor-value care to significant numbers of people with the greatest health care needs; the available data show that people with serious health care needs are leaving these plans at disproportionately high rates and that many Medicare Advantage plan networks do not include centers of excellence and often include lower-quality providers than traditional Medicare.
  • Medicare Advantage plans should be penalized financially, if not cut from the program, for failing to release complete and accurate encounter data, as required.
  • Medicare Advantage plans should be penalized financially, if not cut from the program, for widespread inappropriate delays and denials of care,

Here’s more from Just Care: