The study found that a 10-percentage-point increase in Medicare Advantage (MA) penetration is associated with a 0.8–1.9 percent decrease in total Medicare spending per capita. This translates to a 10-year savings estimate of approximately $59–$144 billion (in 2021 dollars)….
When compared to traditional Medicare (TM), MA’s approach is associated with improved outcomes for beneficiaries, including 70 percent fewer readmissions, 24 percent fewer preventable hospitalizations, and 21 percent lower rate of high-risk medication use….
Finally, in fiscal year 2023, Medicare improper payments accounted for $31.2 billion in TM, nearly double the amount in MA ($16.6 billion), even though enrollment in TM and MA was evenly split in 2023….
As MA penetration grew over the past decade, the rate of improper payments in TM dropped from 12.7 percent in 2014 to 7.4 percent in 2023.
Source: Health Affairs