The research shows how capitation and faster claim payment in Medicare Advantage (MA) helped maintain cash-strapped physician practices, while risk stratification methods allowed health plans to quickly reach seniors most in need.

The study, conducted by Health Management Associates (HMA), was released by Better Medicare Alliance, a research and advocacy organization that supports MA. It evaluated the MA community’s response to COVID-19 and key differences in MA and fee-for-service (FFS) Medicare’s abilities to meet beneficiary and provider needs.

The 22-page report is based on a review of more than 70 publications and public data spanning the length of the ongoing pandemic and was supplemented by 18 in-depth interviews with MA plans and health care provider organizations.

The study found that capitated payment arrangements in MA offered key flexibilities and financial support to providers facing revenue losses as patient visit volumes declined in the first months of the public health emergency, according to the study announcement.

“Providers who received capitation from health plans consistently described how these payments afforded them the flexibility to provide support to patients, enabled them to conduct more regular outreach to patients, and reduced their fears about revenue losses stemming from declines in visit volume,” HMA writes in the white paper.

HMA also noted that MA’s faster transition to telehealth and its leveraging of supplemental benefit offerings helped keep beneficiaries safe in the home and supported providers’ efforts to deliver effective care during the pandemic.

Interviews conducted for the report revealed that “providers appreciated the quick action many health plans took to clarify coverage of virtual care services and key supplemental benefits helping beneficiaries remain safe and healthy in their homes.”

The report additionally finds that “while all of the providers interviewed stated Medicare’s expanded coverage of virtual care services was essential during 2020, several also stated MA was quicker than FFS Medicare to expand coverage of these services” early in the pandemic.

The report comes in the wake of separate Better Medicare Alliance-commissioned research that found MA had lower COVID-19 hospitalization and mortality rates than FFS Medicare during the first nine months of COVID-19.

The findings offer insight into the actions that MA took during COVID-19 to keep beneficiaries safe from harm, all while playing an important role in keeping doctors offices’ doors open, Mary Beth Donahue, president and CEO of Better Medicare Alliance, said in the study announcement.

“From firsthand stories of health plans purchasing toilet paper for beneficiaries and offering virtual companionship to ease the pain of isolation that COVID-19 wrought for so many, to providers’ testimonials of Medicare Advantage’s faster transition to virtual care and quicker claims payment, this report shows how Medicare Advantage met the moment and showed up for beneficiaries and providers alike,” she said.

“The providers interviewed noted the flexibility of health plans to pay predictable capitated payment rates, offer supplemental benefits, and conduct care management activities as ways MA enabled them to stay afloat in the face of declining patient volumes and staff fatigue,” said Zach Gaumer, principal at HMA and lead researcher on the report.