Sickest Senior Citizens Appear to be Leaving
Medicare Advantage for Traditional Medicare
Some question if private HMO-style plans
structure care to be less appealing to very ill, want to hold more
profitable patients; maybe very sick seniors more interested in
By Jordan Rau, KHN Staff Writer
Feb. 4, 2013 - New research finds that many
seniors who switch from their HMO-style Medicare Advantage plan to
traditional Medicare have higher levels of significant health
problems, fueling concerns that the private plans cater to more
profitable, healthy beneficiaries but don’t provide the most
attractive care for the very ill.
people, a quarter of all Medicare beneficiaries, are
enrolled in these private plans. Enrollment has been growing, in
part because the plans often offer lower premiums than does
traditional Medicare, as well as special perks such as
Many Republicans want to build on them while
capping the amount of money each Medicare beneficiary gets toward
insurance. Democrats are disturbed the plans are more expensive than
traditional Medicare and cut payments in the 2010 health law.
The federal government pays the plans a set fee
for each enrollee. That has drawn concerns from some senior
advocates that the plans have incentives to skim off the
lowest-maintenance customers and leave the expensive patients to
released Thursday, by Gerald Riley, a researcher at the Centers for
Medicare & Medicaid Services (CMS), adds to those concerns. The
study looked at more than 240,000 people who dropped out of Medicare
Advantage plans in 2007, and compared them with beneficiaries who
remained in traditional Medicare the entire time.
In the six months after leaving the private
plans, the former Medicare Advantage patients used an average of
$1,021 in medical services each month, while the patients in the
control group cost Medicare $710 a month, the study found.
in the December issue of the journal Health Affairs found
that people "disenrolling were much more likely than other
beneficiaries to report health declines."
Those researchers, led by J. Michael
McWilliams, a Harvard Medical School professor, surmised that
beneficiaries who developed serious ailments might leave the plans
to get unfettered access to physicians and treatments through
traditional Medicare, but neither that study nor Riley’s determined
what motivated the changes.
"It may just be a benign motivation, that
patients, when they're sick, want the freedom to go where they
want," said Robert Berenson, a senior fellow at the Urban Institute.
McWilliams' study, along with other analyses in
the same issue of Health Affairs, found that generally, Medicare has
succeeded in reducing cherry-picking by Medicare Advantage plans by
changes in how the program worked, including restrictions in the
time periods that people could switch from a private plan back to
traditional Medicare. In 2006, Medicare tried to crack down on
switches by limiting them to once a year rather than monthly.
Robert Zirkelbach, a spokesman for America's
Health Insurance Plans, a trade group, said the government has
protections in place to ensure these plans provide satisfactory care
for the sick. "CMS reviews these plans every single year
specifically to make sure they are not discriminating against any
kind of beneficiaries," he said.
He also noted that other independent studies
have found Medicare Advantage plans do a superior job in caring for
enrollees. For instance, another study
in the December Health Affairs found that people in the private
plans were less likely to end up in the emergency room and get
elective surgeries, and more likely to get certain recommended types
of patients in three big states—California, New York and
Florida — by researchers at the federal Agency for Healthcare
Research and Quality determined people in private managed care plans
were less likely to end up in the hospital.
Riley's study noted the health law’s reduction
in payments to Medicare Advantage plans. "This may intensify
pressure on plans to encourage selective disenrollment," he wrote.
"Chronically ill enrollees may be more inclined to disenroll if
access to care deteriorates or if plans cover a smaller portion of
the costs of their care."
Judith Stein, executive director of the Center
for Medicare Advocacy, a watchdog group based in Connecticut, said
the conclusions echo anecdotal experiences her group has seen as it
assists the elderly trying to obtain services.
"Private Medicare Advantage plans work for
people when they are relatively well, but fall short of traditional
Medicare when they are sick or disabled," she said. "This is
particularly true for our clients with long-term and chronic
conditions, many of whom also have low incomes. They are often
denied coverage for necessary skilled care, or it is terminated
before it should be, while the same coverage would be available in
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