Avalere Research at a Glance: Medicare Advantage Delivers Better Outcomes for Chronically Ill Low-Income Beneficiaries

Medicare Advantage health plans specialize in caring for some of the fastest growing and most clinically complex populations, dually-eligible beneficiaries and those managing multiple chronic conditions. New research conducted by Avalere found dually-eligible beneficiaries in Medicare Advantage and those with multiple chronic conditions experienced significantly better outcomes and cost savings compared to similar beneficiaries in Traditional Fee-for-Service (FFS) Medicare. These findings are important to policymakers, in part due to the relatively large $312 billion in expenditures for the relatively small population of approximately 11 million dually-eligible beneficiaries.

In the study population, Medicare Advantage had a slightly higher percentage of dually-eligible/low-income beneficiaries with chronic conditions than FFS Medicare. Dual-eligible status has been found to be the greatest predictor of poor health outcomes, leading to high health care needs and cost due to disability status, low income, and a lack of social supports. Yet, Medicare Advantage achieved 17% lower annual costs, 33% fewer total hospitalizations, and 42% fewer emergency room visits per dually-eligible beneficiary compared to FFS Medicare. While the study did not explore causal relationships, the authors suggest that the higher frequency of primary care visits and preventive services in Medicare Advantage could be the primary reason dually-eligible beneficiaries experienced better health outcomes.

The study also looked at clinically complex individuals, or those who had multiple chronic conditions. The findings revealed that health outcomes and cost savings were significantly better for clinically complex beneficiaries. They had 71% lower rates of serious complications and 21% lower average per beneficiary costs than similar beneficiaries in FFS Medicare. These findings corroborate previous research on Medicare Advantage Chronic Condition Special Needs Plans (C-SNPs) for diabetic patients showing that they boost primary care visits while reducing hospital use. For example, one study found diabetic patients in Medicare Advantage experienced a 19% reduction in hospital inpatient days and an 11% reduction in hospital admissions compared to FFS Medicare diabetes patients. Another study found beneficiaries in diabetes-focused C-SNPs were more likely to receive primary care services and diabetes specific testing, and less likely to use inpatient care.

Medicare Advantage provides high-value care to clinically complex beneficiaries that is not readily available in FFS Medicare, such as disease management programs, supplemental benefits (like vision and hearing), and care management programs. Opportunities to provide additional services for chronically ill Medicare Advantage beneficiaries have expanded in the past year. For example, beginning in 2019, Medicare Advantage health plans may provide all diabetes patients with access to low- or no-cost transportation and/or reduced or eliminated copays for visits to the endocrinologist. As the number of dually-eligible beneficiaries grows, many may be unaware of the option of Medicare Advantage. It is critical that eligible individuals have information about the high-value services in Medicare Advantage compared to FFS Medicare.

This is the final blog in our four-part series providing an overview of the key findings in the Avalere research, and summarizing the demographic characteristics, outcomes for chronically ill beneficiaries, and outcomes for dually-eligible beneficiaries in Medicare Advantage compared to FFS Medicare. The Avalere research provides new information and corroborates existing research on outcomes and utilization in Medicare Advantage. This research report contributes a comprehensive analysis of the outcomes achieved in Medicare Advantage compared to FFS Medicare. The full research report can be viewed here.

To better understand how Congress and the Administration can act to protect and strengthen Medicare Advantage, please visit the Better Medicare Alliance policy resource library and sign up for our policy alerts.