BMA Statement on 2022 Medicare Trustees Report
As fiscal outlook improves, coalition urges policymakers to look to innovations in Medicare Advantage that are yielding lower per-beneficiary spending and greater value for the Medicare dollar
Washington, D.C. – Better Medicare Alliance, the nation’s leading research and advocacy organization supporting Medicare Advantage, issued the following statement upon the release of the 2022 Medicare Trustees Report:
“Medicare is a commitment to our nation’s seniors and individuals with disabilities that must be protected. We are encouraged that this report shows an improved outlook compared to last year’s forecast. As policymakers consider this report’s findings and actions to secure Medicare in the years ahead, there are critical lessons to be drawn from Medicare Advantage,” said Mary Beth Donahue, President and CEO of the Better Medicare Alliance. “Ensuring a more sustainable, stable future for all Medicare beneficiaries compels us to look to the innovations in Medicare Advantage that are resulting in lower per-beneficiary government spending, and annual savings of nearly $2,000 to the average consumer.”
Donahue continued, “All told, Medicare Advantage delivers $32.5 billion in added value to beneficiaries each year, leading the actuaries at Milliman to conclude, ‘the government’s dollar goes further with MA.’ On behalf of the more than 28 million diverse Medicare Advantage beneficiaries nationwide, we look forward to working with policymakers to apply these lessons to ongoing efforts to improve Medicare’s fiscal outlook in light of today’s report.”
Medicare Advantage’s Value to Seniors and Government:
- An October 2021 actuarial analysis from Milliman found nearly $7 lower per-member, per-month government spending in Medicare Advantage than for beneficiaries of a similar health status in fee-for-service Medicare ($942.43 in MA vs. $949.39 in FFS).
- The report goes on to note that Medicare Advantage provides $32.5 billion annually ($123.36 per member per month) in additional benefits and lower out-of-pocket costs for beneficiaries, leading the researchers to explain “findings suggest that overall MA offers significant value for the government.”
- An April 2022 analysis of Medicare Current Beneficiary Survey (MCBS) data conducted by ATI Advisory found that Medicare Advantage beneficiaries report $1,965 less in total annual health spending (out-of-pocket costs and premiums) than those in fee-for-service Medicare, leading to a 36% lower rate of cost burden in Medicare Advantage.
- Even as Medicare Advantage delivers lower government and beneficiary spending, it provides coverage to a proportionally more diverse, medically complex, and socially at-risk beneficiary population.
- For example, Medicare Advantage beneficiaries are more likely to self-report having three or more chronic conditions, they are more likely to be food insecure, and are more likely to self-report diagnoses of diabetes, COPD, congestive heart failure, or dementia, to name a few.
- Enrollment in Medicare Advantage among beneficiaries who are dually-eligible for Medicaid increased by 125% from 2013 to 2019 alone, even as it decreased by 5% in fee-for-service Medicare.
- Avalere Health reports that “Medicare Advantage has a higher proportion of patients with clinical and social risk factors shown to affect health outcomes and cost than FFS Medicare.