Report: How MA Plan Design Affects Utilization, Health Equity

A new study found that enrollees with zero-premium MA plans are three times as likely to be non-White compared to other MA enrollees and traditional Medicare enrollees.

A new study released Monday found that Medicare Advantage plan design can have a major impact on enrollment and outcomes.

The study was published by Harvard Medical School and Inovalon, a provider of cloud-based software solutions. It used Inovalon’s Medical Outcomes Research for Effectiveness and Economics Registry dataset, which “tracks demographic characteristics and outcomes for about 30% of all MA members at any given point in time,” according to the report.

The researchers found that enrollees with zero-premium MA plans are three times as likely to be non-White compared to other MA enrollees and traditional Medicare enrollees. They’re also more likely to live in urban areas.

In addition, beneficiaries with zero-premium MA plans have a net worth that equals 90% of the net worth that other MA enrollees have and 70% of the net worth that traditional Medicare enrollees have. Zero-premium MA enrollees are also more likely to have a high school education or less, more likely to struggle to speak English, less likely to own a home or vehicle and less likely to be married.  

“We were struck by the extent to which Medicare Advantage plans are not all equal. Contrary to conventional wisdom, Medicare Advantage is not a monolith,” said Boris Vabson, a health economist at Harvard Medical School and co-lead researcher of the study, in an email. “MA plans differ significantly, and we found this to impact how beneficiaries enroll in specific plans and achieve very different outcomes.”

The study also discovered that MA Health Maintenance Organization (HMO) plan enrollees are three times more likely to be non-White than beneficiaries with MA Preferred Provider Organization (PPO) plans. For MA HMO enrollees, healthcare utilization is 29% lower compared to a similar group of MA PPO enrollees.

“We were surprised by the big differences between MA HMO and MA PPO plans,” Vabson said. “In addition to enrolling populations that are more socioeconomically disadvantaged than MA PPOs, those in MA HMOs are also much more likely to have been in commercial HMOs pre-65, suggesting that individuals are creatures of habit or comfort in terms of sticking to the same plan type both under commercial and Medicare coverage.”

Based on these findings, insurers have to pay “special attention” to how they design their MA plans and make adjustments in order to best serve their members, said Christie Teigland, vice president of research science and advanced analytics at Inovalon and co-lead researcher on the project.

“These results can also help Medicare Advantage plans appropriately plan for the resources needed to care for new enrollees, such as types of specialty providers, availability of hospitals, post-acute care, and other needed services,” Teigland said in an email. “They also provide insight into the social risk factors that plans will need to address in new enrollee populations to assure equitable access to care and achieve positive outcomes for all Medicare beneficiaries.”

This study is the fourth of a series of research studies that Harvard and Inovalon are working on together. Previous studies examined the differences between MA and traditional Medicare. The next study will research the dual-eligible population, according to Vabson and Teigland.

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