AHIP Report Touts Medicare Advantage’s Quality Edge, but Hospital Concerns Persist

Enrollees in Medicare Advantage (MA) plans received higher-quality care than those in traditional Medicare, as measured by rates of chronic disease care and preventive screenings, according to new data released by AHIP.¹ The findings provide new evidence on the quality outcomes of MA even as some hospital leaders warn of the MA program’s financial threat to their business.

Stethoscope on charts | Image Credit: © amazing studio - stock.adobe.com

Whereas traditional Medicare reimburses hospitals based on a fee schedule set by CMS, MA plans are run by private insurers and can negotiate rates with hospitals included in their networks.² Enrollment in these plans has grown dramatically over the past 2 decades, from 15% of the Medicare-eligible population in 2001 to more than half (51%) in 2023.^2,3 Many beneficiaries opt for MA because these plans can offer supplemental benefits and a cap on out-of-pocket costs.²

The new AHIP findings reveal that these beneficiaries appear to be receiving higher-quality care.¹ Analysts selected 11 Healthcare Effectiveness Data and Information Set (HEDIS) measures representing preventive care and chronic disease management, including breast and colorectal cancer screenings, guideline-recommended therapy for patients with cardiovascular disease, diabetes management steps, care for rheumatoid arthritis and osteoporosis management, and care for asthma and chronic obstructive pulmonary disease (COPD). Using CMS data on medical and pharmacy claims for 2016-2019, they constructed propensity score–matched cohorts of MA and traditional Medicare enrollees and tested the significance of the differences between the HEDIS measures.

In all but 1 of the measures (use of spirometry testing to assess and diagnose COPD), MA outperformed traditional Medicare. The results were significant (P < .05) for all except bronchodilator treatment to manage COPD exacerbation.

The report authors highlighted the cancer screening data showing that MA beneficiaries were more likely than their counterparts in traditional Medicare to receive screening for breast cancer (73.3% vs 69.9%) and colorectal cancer (38.9% vs 33.1%). The largest difference was in the proportion of women receiving osteoporosis management after a bone fracture, at 42.1% in MA vs just 20.5% in Medicare. Care for prevalent and costly conditions like diabetes also appeared better in MA plans, with more enrollees with diabetes in these plans both receiving and adhering to statin therapy than those in traditional Medicare (receipt: 76.2% vs 72.5%; adherence: 83.4% vs 80.4%).

Prior research shows that a growing share of low-income and minority individuals—who have generally had lower rates of preventive care receipt and worse health outcomes—are enrolling in MA, the report authors wrote, so these individuals are “especially likely to benefit from Medicare Advantage’s focus on preventive care for individuals with chronic illness.”

The report also noted prior research showing MA’s cost efficiency relative to traditional Medicare in terms of lower utilization, fewer hospital readmissions, and lower rates of high-risk medication use. However, a Medicare Payment Advisory Commission report from March 2023 found that Medicare’s payments to MA plans in 2023 will be $27 billion more than if all MA enrollees were in fee-for-service Medicare, and these payments total to 6% higher than all projected fee-for-service spending.⁴

What’s more, leaders of small and rural hospital systems are sounding the alarm that the MA program is an existential threat to their ability to serve patients. Stories published by NBC News⁵ and KFF Health News⁶ this fall contain input from hospital CEOs warning that MA plans’ frequent denials and lower reimbursement rates are straining the hospitals’ budgets and in some cases forcing them to shutter their doors, eliminating a site of care for patients who often have few other accessible options.

Research published in the November issue of The American Journal of Managed Care^® suggested that MA penetration was actually associated with increased financial stability and reduced risk of closure for rural hospitals.² The authors noted that most rural critical access hospitals are situated in markets with low MA penetration, so these trends should be monitored in case of any adverse effects on these vulnerable hospitals as MA enrollment grows.

Of note, the study used data from 2008 through 2019, which were the most recent data available but prevent the detection of the COVID-19 pandemic’s impact on hospitals’ financial well-being.

References

1. Medicare Advantage provides higher quality of care and better rates of preventive service use when compared to original Medicare. AHIP. December 13, 2023. Accessed December 14, 2023. https://www.ahip.org/documents/202312-AHIP_HEDISMeasures-12.5.23.pdf

2. Henke RM, Fingar KR, Liang L, Jiang HJ. Medicare Advantage in rural areas: implications for hospital sustainability. Am J Manag Care. 2023;29(11):594-600. doi:10.37765/ajmc.2023.89455

3. Ochieng N, Biniek JF, Freed M, Damico A, Neuman T. Medicare Advantage in 2023: enrollment update and key trends. KFF. August 9, 2023. Accessed December 14, 2023. https://www.kff.org/medicare/issue-brief/medicare-advantage-in-2023-enrollment-update-and-key-trends/

4. The Medicare Advantage program: status report. In: Report to the Congress: Medicare Payment Policy. Medicare Payment Advisory Commission; 2023:319-380. Accessed December 14, 2023. https://www.medpac.gov/wp-content/uploads/2023/03/Ch11_Mar23_MedPAC_Report_To_Congress_SEC.pdf

5. Morgenson G. ‘Deny, deny, deny’: by rejecting claims, Medicare Advantage plans threaten rural hospitals and patients, say CEOs. NBC News. October 31, 2023. Accessed December 14, 2023. https://www.nbcnews.com/health/rejecting-claims-medicare-advantage-rural-hospitals-rcna121012

6. Tribble SJ. Tiny, rural hospitals feel the pinch as Medicare Advantage plans grow. KFF Health News. October 23, 2023. Accessed December 14, 2023. https://kffhealthnews.org/news/article/medicare-advantage-rural-hospitals-financial-pinch/