Medicare Advantage 'Critical' For Low Income,
Minorities
Sept. 20, 2005 - A study released today shows the
critical role the Medicare Advantage program plays in providing
low-income and minority Medicare beneficiaries with access to health
care, and in saving the Medicaid program millions of dollars.
"It is clear that low-income and minority
populations rely heavily on the Medicare Advantage program," said
Kenneth Thorpe, professor and chair of the Department of Health Policy &
Management, Emory University.
"Because these programs are often affordable and
include benefits not found in traditional Medicare, many with lower
incomes depend on it. In many cases, the same people enrolled in
Medicare Advantage are actually eligible for Medicaid, so any loss of
Medicare Advantage participation would likely result in increases in
Medicaid costs," he said.
The study, titled Value of Medicare Advantage to
Low-Income and Minority Medicare Beneficiaries, found that Medicare
Advantage serves a high proportion of minority beneficiaries. Forty
percent of African American and 53 percent of Hispanic beneficiaries
without Medicaid or employer coverage rely on Medicare Advantage, as
compared with 33 percent of non-Hispanic, white beneficiaries. When
examining income level, the study shows that Medicare Advantage plans
disproportionately cover low- income beneficiaries: 36 percent of
Medicare eligible beneficiaries with incomes below $10,000 annually and
38 percent of those with incomes from $10,000 to $20,000 without
Medicaid or employer coverage enroll in Medicare Advantage plans.
In addition, the study found that Medicare
Advantage lowers Medicaid costs significantly, providing comprehensive
coverage to low-income "dual eligible" beneficiaries. The authors found
that nearly 18 percent of all those eligible for Medicaid enroll in a
Medicare Advantage plan providing "substantial" savings to the Medicaid
program. Without Medicare Advantage, the study estimates that Medicaid
costs would increase by $792 million annually and roughly $4 billion
over 5 years.
The study, conducted by Thorpe and Adam Atherly,
Ph.D. at Emory University, examines who enrolls in Medicare Advantage,
how Medicare Advantage affects Medicaid costs, and how enrollees would
be affected if Medicare Advantage was not available. The study was
released at a briefing today at the Blue Cross and Blue Shield
Association (BCBSA).
Additional findings of the study include:
Medicare Advantage provides value to Medicare
beneficiaries by providing more comprehensive benefits and more
financial protection than traditional Medicare coverage. "Medicare
Advantage will provide Medicare beneficiaries $3 billion in supplemental
benefits in 2005 at no cost to the beneficiary, or an annual average of
$615 per Medicare Advantage enrollee, net of premiums paid by
beneficiaries."
Based on analysis of beneficiary purchasing of
supplemental coverage, without Medicare Advantage, 2 million
beneficiaries would lose supplemental coverage and would rely on
Medicare alone for their healthcare coverage. As a result, the
percentage of Americans without any supplemental coverage would increase
by 32 percent. Ethnic minorities would be especially hard hit, as the
number of African-Americans without any supplemental coverage would rise
to 59 percent.
While the Medicare Advantage program is slated for
expansion in 2006, Congress is currently debating possible funding cuts
to the program.
"As Congress debates potential cuts to Medicare and
Medicaid funding, it is crucial that we understand how much people,
especially minorities and those with low incomes, rely on these programs
to provide affordable and comprehensive health benefits," said Mary Nell
Lehnhard, senior vice president, BCBSA. "In addition, cuts to Medicare
Advantage will likely only drive up costs for Medicaid."
The full study is available, along with more
information, at:
click here.
About Blue Cross and Blue Shield
The Blue Cross and Blue Shield Association is made
up of 40 independent, locally owned and operated Blue Cross and Blue
Shield companies that collectively provide healthcare coverage for more
than 93 million -- nearly one-in-three -- Americans. For more
information about the Blue Cross and Blue Shield Association and the
Blue Cross and Blue Shield companies, visit
http://www.BCBS.com . For more information on Blue Cross and Blue
Shield Association's policy positions and the healthcare debate, visit
http://www.BCBSHealthIssues.com
