Wednesday, September 16, 2009

Does Medicare Advantage Stink or Rock?

Today, America's Health Insurance Plans (AHIP) released data showing that Medicare Advantage enrollees in Nevada and California had fewer inpatient days per patient, lower readmission rates, and lower rates of avoidable hospital admissions then Medicare B enrollees. Can (commercial) Medicare Advantage really be better for patients and cheaper than plain old vanilla Medicare?
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Well, a contradictory report released by the Commonwealth Fund, says Advantage plans are paid $1,140 more per enrollee than providers would have gotten under regular Medicare.

So are Part C plans more efficient (and cheaper) or not?

There are several possible explanations for the data disconnect:
1. Data does what you want it to do (hardly satisfying).
2. Medicare Advantage plans kept patients out of the hospital but because they get paid 110% of Medicare they STILL cost American taxpayers an extra $1,140 per patient.
3. The states studied made the difference.

Regardless of the big picture, it's still pretty clear that Medicare Advantage plans stink for providers who want to get paid.


  1. Is this data risk-stratified? Medicare Advantage plans have salesmen that cherry pick the healthy seniors. I have many Advantage patients in my practice and the insurance company does nothing that I can see to promote good health, improve adherence, avoid readmissions, shorten LOS and certainly nothing to justify a premium payment from CMS for what they do.
    Humana reported a $281 million quarterly profit based on "their Medicare Advantage" products- should our tax dollars be funding stockholder profits?

  2. With that said, I do believe that MA have been a falure. If it cost the government 14% more than it would if MA members where on original Medicare, then it is a falure. Doctors don't like these plans, because they have a lot of overhead in billing cost and personel expense. I think the idea of privitizing Medicare was a good one, but this has been a falure. MA needs to be reformed or extinguished. Medicare supplements are by far a better plan for seniors on Medicare. If a Medicare beneficiary chooses a Plan F or J Medicare supplement, they will have all the gaps in Medicare paid.

  3. There's a good description of how MA works and the potential effects of the proposed health care reform bill at Silver Buzz Cafe -