Matthew Holt at The Health Care Blog writes:
Critics (notably ex CMS veterans Berwick & Gilfillan) claim that risk adjustment games played by the private plans who run Medicare Advantage have cost up to $200bn over 10 years. Medpac (the independent body that advises Congress) estimates that “Medicare spends 4 percent more for MA enrollees than it would have spent if those enrollees remained in FFS Medicare” …. However data from the Medicare Trustees and other research from ACHP & the trade group Better Medicare Alliance suggests that Medpac’s analysis is incorrect and that Medicare Advantage saves the government about 9% per enrollee.
George Halvorson says the Medpac report is “fake news”:
It actually costs less to buy care with MA. The plans have a process where they bid on what their monthly payment will be each year and the average bid is currently less than 85 percent of the average cost of paying for fee-for-service Medicare in each county….
MA has about 35 percent fewer emergency room days. That’s true every year. MA has programs to reduce the crisis level congestive heart failure events and that tends to result in 40 percent fewer hospital days for those patients. MA plans have many more eVisits. Fee-for-service Medicare does not pay for eVisits….
The plans also have quality reporting and expectations that do not exist at any level today in fee-for-service Medicare…. Fee-for-service Medicare, by contrast, actually does not have one single quality measure.
Here is Halvorson Part II, with an observation on Covid:
Every single MA member had the security from day one of knowing where to go for their Covid care. They all had care sites immediately because they were all members of plans, and those care sites and care systems in the plans all went through their own learning process to figure out the relevant Covid-related issues of care.
Fee-for-service Medicare had nothing.
Fee-for-service Medicare had no Covid plan or Covid-related approach. Fee-for-service Medicare left many people functionally orphaned and isolated because the fee-for-service enrollees who already had some level of care relationships in place could try to get into those sites but the people with fee-for-service Medicare Coverage who did not have care linkages in place were simply orphaned by Covid. They had to scramble on their own to find Covid care and information with literally no support from fee-for-service Medicare.
This is from Part III:
Two out of three low-income Americans have now joined MA. More than half of all African American Medicare members and more than 60% of Hispanic members are now in MA plans.
Along with this:
We have up to a third of the people who are dying in hospitals who have had wrong diagnosis along the way to their care. That should not be happening. We need better data, better outcomes, better connections, better diagnosis, and better care, and we need to spend less to get more because the science should make that entirely the path we are on.
1 thought on “Does Medicare Advantage Save the Government Money?”
I wonder if Medicare Advantage (MA) doesn’t reduce fraud. In theory MA has the tools and the incentive to reduce waste, fraud and abuse. The old argument for MA was that to the degree it cost more than FFS Medicare, the difference was reflected in additional benefits for seniors.