RISE examines the latest research news involving Medicare Advantage (MA).
Urban Institute: MA quality bonus program fails to meet its goals, needs overhaul
A new report by the Urban Institute finds that the MA Star rating system and the quality bonus program don’t appear to achieve their goals of informing beneficiaries or encouraging MA insurers to improve quality.
Researchers reviewed literature and conducted an analysis of the 2023 MA Star ratings data and related MA enrollment data to explore the quality bonus program and its role in the MA payment system, described the Star ratings measures and how they are scored, and identified the shortcomings of the quality bonus program. They found:
- While clinical quality measures account for over half of the measures used in the Star-rating system, after weighting, about two-thirds of a contract’s Star rating is determined by beneficiary experience with care and MA administrative effectiveness. On review, however, researchers find that:
- Measures of beneficiary experience do not permit meaningful distinctions across MA contracts
- Administrative effectiveness measures do not target important deficiencies regulators have identified within MA organizations
- The Star-rating system and the program suffer from many problems, including the following:
- Score inflation, which results in overly generous bonuses
- Limitations in underlying data sets, which lead to measures focused on the needs of younger and healthier beneficiaries rather than beneficiaries facing serious illnesses
- Performance not measured at the plan or local level, limiting the usefulness of Star ratings for beneficiaries’ choice
- Contrary to the program’s goals, beneficiaries typically do not use Star ratings when selecting plans.
- Despite the 10-year commitment to paying MA plans substantial bonuses to support successful quality improvement, research finds that it does not demonstrate that beneficiaries, on average, receive higher quality care in MA than they would in the traditional Medicare program.
Researchers called on the Centers for Medicare & Medicaid Services (CMS) to take further steps to reduce inflated Star ratings. CMS can change the Star rating system from contract-level reporting to contract-and-state-level reporting to make the Star ratings more relevant for beneficiaries. It could also adjust cut points to lower the share of plans receiving quality bonuses and to add quality measures to focus on issues more important for the Medicare population. However, it will require an act of Congress to allow the program to assess penalties for poor performance or to abandon the 5-star rating system.
Enrollee snapshot: Report finds clear differences between those who opt for MA vs. traditional Medicare
A new study conducted by Inovalon and Harvard Medical School reveals the detailed characteristics of individuals who chose MA over fee-for-service (FFS) Medicare enrollees.
The white paper is the first in a series of reports conducted by Inovalon and researchers at the Department of Health Care Policy at Harvard Medical School. The study aims to uncover and analyze underlying factors influencing enrollment in MA or FFS Medicare based on a comparison made at a critical point in a beneficiary’s journey: as seniors transition from commercial to Medicare coverage, at 65.
“The early findings from this first-of-its-kind research give an important view into the pre-65 demographic, clinical, and social risk characteristics of the rapidly growing Medicare population,” said Michael Chernew, Ph.D., health economist and professor at Harvard Medical School, who is helping oversee the project, in the study announcement. “The findings provide new resources for policymakers and health care administrators to improve the delivery of value-based care programs, address health inequities, and improve health outcomes for all beneficiaries.”
The study is based on Inovalon’s unique dataset, which allowed researchers to track a given individual's health and utilization both before and after Medicare enrollment, across both commercial and Medicare coverage. The data also includes highly detailed, Zip9-level socioeconomic data, drawn from different sources and included median household income, education level, race and ethnicity, living alone, English proficiency, and other social risk factors. The information provides an expanded view of enrollees because previous research was limited to just Medicare data and comparing the MA and FFS groups after Medicare enrollment, according to the study announcement.
According to the report:
- MA enrollees are twice as likely to be non-white and much more likely to be Black, Hispanic, or Asian.
- MA enrollees are more than 50 percent more likely than those in traditional Medicare to have been enrolled in an HMO plan immediately before turning 65.
- There are substantial differences in health-relevant socioeconomic characteristics of MA and traditional Medicare enrollees:
- The average income of a traditional Medicare enrollee is $85,085, compared to $76,720 for an MA enrollee. This gap arises from the relative lack of MA enrollees in the most affluent segments.
- While 35.5 percent of traditional Medicare enrollees live in a neighborhood with incomes above $100,000, this is true for only 23.8 percent of MA enrollees.
- The average MA enrollee has a net worth that is 74.2 percent of the average traditional Medicare enrollee.
MA spending lower than FFS for those with chronic conditions
MA beneficiaries with chronic conditions had fewer inpatient stays and emergency department visits than FFS Medicare beneficiaries, according to an updated Avalere analysis funded by Better Medicare Alliance.
The study compared clinical characteristics, utilization, spending on health care, and quality of outcomes in two sample populations of beneficiaries in MA and FFS Medicare with at least one of three highly prevalent and clinically related chronic conditions: hypertension, hyperlipidemia, and diabetes. Researchers found:
- MA serves a higher proportion of beneficiaries with clinical and social risk factors than FFS.
- MA serves a higher percentage of beneficiaries who identify as a racial or ethnic minority than FFS (28.1 percent in MA vs. 12.8 percent in FFS).
- Regardless of condition, MA beneficiaries in the chronic condition subgroups spend less overall on health care than FFS beneficiaries.
- MA beneficiaries in the study had lower utilization rates of high-cost services such as inpatient stays and emergency room visits than FFS beneficiaries.
Avalere said additional research is needed to explore the factors driving differences between MA and FFS. However, the findings suggest that demographic differences between these Medicare populations exist, that spending on care is lower in MA, and that outcomes on select quality measures are comparable to FFS.
Study finds a lack of psychiatrists in MA networks
MA beneficiaries may have a harder time finding a psychiatrist than those enrolled in Medicaid managed care and Affordable Care Act (ACA) plan markets, according to a new study in Health Affairs.
Researchers used a novel data set linking network service areas, plans, and providers to compare psychiatrist network breadth—the percentage of providers in each area that are considered “in network” for a plan—across MA, Medicaid managed care, and ACA plan markets. They found that nearly two-thirds of psychiatrist networks in MA were narrow and contained fewer than 25 percent of providers in a network’s service area compared to 40 percent in Medicaid managed care and ACA plans.
The research team did not see similar differences in network breadth for primary care physicians or other physician specialists across markets. The findings suggest that psychiatrist networks in MA are particularly narrow, which may disadvantage enrollees as they attempt to obtain mental health services.