Medicare Advantage Payment Cuts Did Not Affect Member Care Access

September 03, 2019 - Contrary to the negative predictions, Medicare Advantage beneficiaries’ access to care and health plan affordability did not change between 2009 to 2017, according to a recent study published in the American Journal of Managed Care.

“The ACA’s reductions to MA plan payments were not associated with declines in healthcare access or affordability for MA enrollees,” the study said. “In fact, as payment cuts were phased in, MA plans reduced costs without diminishing healthcare access or affordability for enrollees relative to TM [Traditional Medicare] beneficiaries. Despite contrary projections, MA plans experienced steady, robust enrollment growth from 2009 to 2017, implying that MA plans became more attractive to beneficiaries during a period of increasing payment pressure.”

The Affordable Care Act decreased Medicare Advantage payments because, at the time, Medicare Advantages plans received payments of up to 114 percent traditional Medicare spending. Whether the program is still getting overpaid is up for debate.

Due to the reduced payments, Medicare Advantage plans cut down on their bids, dropping them from 102 percent of the traditional Medicare price to 90 percent. Some believed that by lowering payments for Medicare Advantage plans, members would pay the consequences in lower affordability and limited access to providers.

Previous research revealed that following bid cuts, the Medicare Advantage plans successfully lowered expenditures as a result of the ACA. However, what the research had not disclosed, until now, was the impact that reducing Medicare Advantage funding had on the patient experience.

The study surveyed Medicare Advantage and Traditional Medicare beneficiaries in 2009, 2011, and 2017 and found that there was no significant change in healthcare access or affordability due to the cut in Medicare Advantage payments.

To address a member’s access to care, the study questioned whether the enrollee had a provider, how often the member visited, and whether they had to wait to receive care because of the line.

The study found that Medicare Advantage beneficiaries were more likely to respond that they had a primary doctor and had seen their physician in the past 12 months, as compared to Traditional Medicare beneficiaries.

Both Traditional Medicare and Medicare Advantage attested to being denied a provider, having their insurance rejected, and being let go from their provider. Neither program experienced a change in this regard during the transition but each program’s rates in these areas were very similar to the other’s.

The survey also asked if the respondent had any healthcare delays or did not receive care due to the price, not just for themselves but for their families as well.

Medicare Advantage beneficiaries reported cost-related care postponement more often than Traditional Medicare enrollees. In 2009, 7.4 percent of Medicare Advantage enrollees reported this challenge and in 2017 that number decreased to 5.6 percent. Nevertheless, it remained higher than Traditional Medicare by one percentage point.

Furthermore, Medicare Advantage beneficiaries had higher rates than Traditional Medicare enrollees.

This negative condition, however, did not seem to be a result of the ACA since the changes were so slight.

“However, changes in delay in care for cost reasons were not statistically significant in either MA or TM, and there was no statistically significant difference between the MA change and the TM change over the study period,” the researchers explained. “There were no statistically significant differences between MA changes over time and TM changes over time in any affordability measures.”

Enrollment did not suffer due to the cuts. In fact, it rose. The study suggests that the rebates may be what continues to draw members to Medicare Advantage.

The researchers also noted that Medicare Advantage plans were buoyed by higher quality scores. These quality scores impact performance-based rebates and revenue. The authors also believe that the diagnostic coding changes may have helped the risk adjustment program.

To the researchers, these findings demonstrated that Medicare Advantage plans could decrease costs while preserving the quality healthcare access and affordability of Medicare Advantage health plans.

This study comes in the wake of CMS closing public comment on its risk adjustment data validation for 2020. As CMS deliberates, knowing the present state of Medicare Advantage and the effect of the Affordable care Act will prove critical.