Medicare Advantage Plans Draw More Members with Chronic Diseases

Medicare Advantage plans saw a higher number of members with chronic diseases, substance abuse, and serious mental health conditions.

By Kelsey Waddill

May 20, 2021 - In 2020, Medicare Advantage plans attracted members with chronic diseases but still maintained lower out-of-pocket healthcare spending for members than fee-for-service Medicare coverage did, a Better Medicare Alliance (BMA) study found.

“We can say with certainty that the state of Medicare Advantage is strong,” Allyson Y. Schwartz, president and chief executive officer of BMA, said in the press release.

“As Congress and the Biden Administration work to address health disparities, lower consumer costs, and accelerate the move to value-based care, our research shows how Medicare Advantage is leading the way and is a critical partner in these efforts to modernize and improve health care delivery.”  

Beneficiaries in Medicare Advantage and fee-for-service Medicare tend to face many of the same chronic conditions. However, Medicare Advantage plans drew a higher share of members who require chronic disease management.

Almost 70 percent of Medicare-eligible seniors with five chronic conditions or more reported that they were more likely to choose a Medicare Advantage plan compared to Medicare beneficiaries with no chronic conditions.

According to BMA, the majority of Medicare beneficiaries with any number of chronic diseases were more likely to choose a Medicare Advantage plan.

Top chronic conditions among both Medicare Advantage and traditional Medicare beneficiaries included high blood pressure, hyperlipidemia (or high cholesterol), arthritis, and heart disease.

Medicare Advantage members were also more likely to have enrolled in Medicare due to a disability, had a higher rate of substance abuse, and a 57.4 percent higher rate of serious mental health conditions compared to traditional Medicare beneficiaries.

This may be due to the broad span of additional benefits that Medicare Advantage plans can offer, both supplemental benefits and social determinants of health benefits. In 2020, more than 66 percent of Medicare Advantage plans offered wellness, dental, vision, and hearing coverage.

Health plans offered meals, social needs benefits, pest control and other benefits as part of the Special Supplemental Benefits for the Chronically Ill (SSBCI) expansion on Medicare Advantage coverage of health-related and social determinants of health-related needs.

A separate study by Avalere confirmed that 15 percent of non-employer Medicare Advantage plan members had access to Medicare Advantage supplemental benefits for chronically ill individuals.

Most Medicare Advantage plans spent less than Medicare did per beneficiary, lowering not only beneficiary costs but also federal costs. The report estimated that Medicare Advantage plans have saved taxpayers around $6 billion on Medicare premium subsidies.

Over four in ten Medicare beneficiaries (42 percent) had a Medicare Advantage plan, the BMA report noted. The organization expected that share to increase to over 50 percent by 2030, in accordance with the Congressional Budget Office’s projections.

Unsurprisingly, Florida had the highest ratio of Medicare Advantage member (48.71 percent) to fee-for-service Medicare enrollees, followed closely by Hawaii (47.58 percent Medicare Advantage members) and Oregon (47.07 percent Medicare Advantage members).

Almost all Medicare beneficiaries (99 percent) had access to a Medicare Advantage plan option, according to BMA.

Carrying on the trends from previous years, the Medicare Advantage population grew more diverse.

More than three in ten Medicare Advantage members identified as a minority group, compared to approximately two in ten Medicare fee-for-service beneficiaries. Individuals who identified as Hispanic contributed 13.8 percent of the Medicare Advantage population and those who identified as non-Hispanic Black made up 12.7 percent of the population in 2020.

A Medicare Advantage plan is not a health plan restricted to wealthy Americans. These health plans have attracted growing numbers of low income beneficiaries in recent years. In 2020, more than a quarter of Medicare Advantage members were dual eligibles and almost a fifth were part of a household with a median income of under $30,000.

Most seniors found Medicare Advantage to be an affordable option, particularly in regards to out-of-pocket healthcare spending. Medicare Advantage plans can produce a 40 percent lower rate of cost burden when compared to traditional Medicare coverage with average out-of-pocket cost savings of around $1,640.

Medicare Advantage has received broad support among policymakers, but never more so than in 2020.

The highest number of signatories ever to sign a letter of support for Medicare Advantage signed the letter to the Biden administration last year. The issue was very bipartisan, with the ten congressional districts that have the highest Medicare Advantage enrollment being split evenly between both parties.

https://healthpayerintelligence.com/news/medicare-advantage-plans-draw-more-members-with-chronic-diseases