While it’s akin to picking a favorite child, this Breakdown may be the bestest of the bunch. Nicely done, Preston. Your wit and wisdom are appreciated. Cheers from Chapel Hill
While there are always opportunity to fine tune health spending, there are some meaningful failures of Medicare fee-for-service (FFS) that need to be acknowledged, for which Medicare Advantage (MA) has outperformed.
First, disease prevention. As summarized in a Sep 16, 2022 KFF report[1], MA patients were more likely than traditional Medicare patients to receive annual wellness exams, screenings, and vaccinations. Similar results we cited in that article for more consistent guideline-based control of heart disease and diabetes among MA members than Medicare FFS for patients. Per this report, MA was not a panacea on all metrics, but rarely did it underperform FFS.
The "coding intensity" issue, which contributes to the higher per-capita spend, is not necessarily bad. Medicare fee-for-service providers, paid by CPT code, disproportionally fail to code a full patient's disease burden. This creates unfortunate long-term issues, and associated cost. For example, a large percent of patients that "crash" into dialysis without ever having a diagnosis of kidney disease. Risk-based coding like that used with MA helps catch these patients earlier. The patients with serious depression that is both uncoded and untreated is similarly scary. Here again, risk-coding helps. Similarly, providers simply failing to recode an active diabetic who they are treating may not directly affect outcomes, they are being treated after all, but the lack of data means it is harder to monitor these patients with secondary disease prevention measures (e.g., foot exams, eye exams) that their conditions warrant.
While the author of the above post has certainly cast light on an important issue, and I applaud him for doing so, alas, no system is perfect, I think MedPAC Chair Michael Chernew summed up the issue nicely in his Jan 25, 2024 interview with MedPage Today, “I believe the Medicare Advantage program has successfully changed patterns of care in ways that have reduced overall utilization. They have enabled plans to offer better benefits to beneficiaries, financed by the plans' efficiencies as well as the payments they've received. And there's a range of technical things -- changing the risk adjustment models, which we have already done -- and making changes to the quality bonus program. There's a lot of strategies one could take if one wanted to improve the balance of payments between Medicare Advantage and fee-for-service.” [2]
[1] Beneficiary Experience, Affordability, Utilization, and Quality in Medicare Advantage and Traditional Medicare: A Review of the Literature. KFF
About those wellness exams: they say you are well without lab tests, x-rays, etc, . I can read an eye chart with only one eye, yet I am well. I think wellness is a foregone conclusion. When I see a doctor, I want treatment. There's lots of conditions to choose from.
The "coding intensity" issue is not necessarily bad??!! Thats a joke, right? It was MA's widespread, fraudulent "coding intensity" that the feds prosecuted, finding ALL of the major MA companies guilty of ripping off the taxpayers to the tune of hundreds of millions of dollars. Sadly, the feds ultimately let the MA criminals off the hook by vastly reducing the penalties and threatened clawbacks.
I work with seniors across the country helping them to make Medicare decisions. I do NOT sell insurance. I work for my clients. As a result, I get to see first hand the impacts of MA marketing and sales tactics on seniors. Then, the care disparities later in life by the type of coverage they have. It is disgusting to me how insurance agents make 40% more in the initial sale by selling MA over Medigap. Then, agents earn unending residuals on MA but only 6 years on Medigap.
And we wonder why 52% of seniors are on MA?! You cannot convince someone who makes money on something to change their mind about the thing they make money on.
Can you please provide source references for your statement that “insurance agents make 40% more in the initial sale by selling MA over Medigap. Then, agents earn unending residuals on MA but only 6 years on Medigap.”
Also, many medical (and other) professional societies market MA to their members as a “benefit”. What kind of payments do these professional societies receive for this marketing? How can one find how much a SPECIFIC professional society is paid for this marketing? If possible, source references for all this?
Please do let me know if there is a way to learn how much commission is paid to professional organizations (as opposed to individual agents) for marketing MA to their members.
2/3 of the way down, starting at "Agents and brokers can earn even more for doing additional things for MA plans sponsors, including assisting with the completion of health risk assessments (HRAs) for new enrollees." Insurance companies are named (the usual suspects). https://medicareadvocacy.org/ma-misconduct/
While it’s akin to picking a favorite child, this Breakdown may be the bestest of the bunch. Nicely done, Preston. Your wit and wisdom are appreciated. Cheers from Chapel Hill
Thanks Patrick! Really appreciate it! Hope our paths cross again soon.
"Medicare Advantage.
It’s like an HMO, narrow network PPO, capitated payments, old skool Medicare, and unfettered capitalism had a baby."
While there are always opportunity to fine tune health spending, there are some meaningful failures of Medicare fee-for-service (FFS) that need to be acknowledged, for which Medicare Advantage (MA) has outperformed.
First, disease prevention. As summarized in a Sep 16, 2022 KFF report[1], MA patients were more likely than traditional Medicare patients to receive annual wellness exams, screenings, and vaccinations. Similar results we cited in that article for more consistent guideline-based control of heart disease and diabetes among MA members than Medicare FFS for patients. Per this report, MA was not a panacea on all metrics, but rarely did it underperform FFS.
The "coding intensity" issue, which contributes to the higher per-capita spend, is not necessarily bad. Medicare fee-for-service providers, paid by CPT code, disproportionally fail to code a full patient's disease burden. This creates unfortunate long-term issues, and associated cost. For example, a large percent of patients that "crash" into dialysis without ever having a diagnosis of kidney disease. Risk-based coding like that used with MA helps catch these patients earlier. The patients with serious depression that is both uncoded and untreated is similarly scary. Here again, risk-coding helps. Similarly, providers simply failing to recode an active diabetic who they are treating may not directly affect outcomes, they are being treated after all, but the lack of data means it is harder to monitor these patients with secondary disease prevention measures (e.g., foot exams, eye exams) that their conditions warrant.
While the author of the above post has certainly cast light on an important issue, and I applaud him for doing so, alas, no system is perfect, I think MedPAC Chair Michael Chernew summed up the issue nicely in his Jan 25, 2024 interview with MedPage Today, “I believe the Medicare Advantage program has successfully changed patterns of care in ways that have reduced overall utilization. They have enabled plans to offer better benefits to beneficiaries, financed by the plans' efficiencies as well as the payments they've received. And there's a range of technical things -- changing the risk adjustment models, which we have already done -- and making changes to the quality bonus program. There's a lot of strategies one could take if one wanted to improve the balance of payments between Medicare Advantage and fee-for-service.” [2]
[1] Beneficiary Experience, Affordability, Utilization, and Quality in Medicare Advantage and Traditional Medicare: A Review of the Literature. KFF
https://www.kff.org/medicare/report/beneficiary-experience-affordability-utilization-and-quality-in-medicare-advantage-and-traditional-medicare-a-review-of-the-literature/
[2] Will All Seniors Eventually Have No Choice but Medicare Advantage?. MedPage Today
https://www.medpagetoday.com/special-reports/exclusives/108423?xid=nl_mostcommented_2024-02-02&mh=9ff565ecc8ff83ac5cbca5d23c29dc5d
Thank you for the comment and additional perspective Kevin! You bring up some amazing points.
About those wellness exams: they say you are well without lab tests, x-rays, etc, . I can read an eye chart with only one eye, yet I am well. I think wellness is a foregone conclusion. When I see a doctor, I want treatment. There's lots of conditions to choose from.
The "coding intensity" issue is not necessarily bad??!! Thats a joke, right? It was MA's widespread, fraudulent "coding intensity" that the feds prosecuted, finding ALL of the major MA companies guilty of ripping off the taxpayers to the tune of hundreds of millions of dollars. Sadly, the feds ultimately let the MA criminals off the hook by vastly reducing the penalties and threatened clawbacks.
Gimme a break.
This is really well done and super helpful! Thank you for writing this!
Thanks so much Stephen!
I work with seniors across the country helping them to make Medicare decisions. I do NOT sell insurance. I work for my clients. As a result, I get to see first hand the impacts of MA marketing and sales tactics on seniors. Then, the care disparities later in life by the type of coverage they have. It is disgusting to me how insurance agents make 40% more in the initial sale by selling MA over Medigap. Then, agents earn unending residuals on MA but only 6 years on Medigap.
And we wonder why 52% of seniors are on MA?! You cannot convince someone who makes money on something to change their mind about the thing they make money on.
FYI, traditional Medicare offers a free full physical annually. I'm due for one now.
Melinda,
Fascinating!
Can you please provide source references for your statement that “insurance agents make 40% more in the initial sale by selling MA over Medigap. Then, agents earn unending residuals on MA but only 6 years on Medigap.”
Also, many medical (and other) professional societies market MA to their members as a “benefit”. What kind of payments do these professional societies receive for this marketing? How can one find how much a SPECIFIC professional society is paid for this marketing? If possible, source references for all this?
https://ritterim.com/blog/2022-maximum-broker-commissions-for-medicare-advantage-and-medicare-part-d/#medicare-advantage-ebook
Kathy,
Thank you!
Please do let me know if there is a way to learn how much commission is paid to professional organizations (as opposed to individual agents) for marketing MA to their members.
2/3 of the way down, starting at "Agents and brokers can earn even more for doing additional things for MA plans sponsors, including assisting with the completion of health risk assessments (HRAs) for new enrollees." Insurance companies are named (the usual suspects). https://medicareadvocacy.org/ma-misconduct/