Avalere: “MA beneficiaries with chronic conditions experience lower utilization … better outcomes” July 2018
Key Findings:
Medicare Advantage has a higher proportion of patients with clinical and social risk factors shown to affect health outcomes and cost than FFS Medicare.
- Medicare Advantage had a higher percentage of beneficiaries with chronic conditions who enrolled in Medicare due to disability (36% versus 22% FFS Medicare) and are dual eligible/low-income beneficiaries (23% versus 20% FFS Medicare) than FFS Medicare.
- Medicare Advantage had a higher proportion of racial/ethnic minorities, who tend to have more clinical and social risk factors, than FFS Medicare (31% versus 15% FFS Medicare).
- Medicare Advantage beneficiaries had a 57% higher rate of serious mental illness1 (9% versus 5% of FFS Medicare) and a 16% higher rate of alcohol/drug/substance abuse (7% versus 6% of FFS Medicare) than FFS Medicare beneficiaries.
Despite a higher proportion of clinical and social risk factors, Medicare Advantage beneficiaries with chronic conditions experience lower utilization of high-cost services, comparable average costs, and better outcomes.
- Utilization of costly healthcare services was lower for Medicare Advantage beneficiaries, including 23% fewer inpatient stays (249 versus 324 per 1,000 beneficiaries in FFS Medicare) and 33% fewer emergency room visits (511 versus 759 per 1,000 beneficiaries in FFS Medicare).
- Average annual Medicare Advantage beneficiary costs were not significantly different from average costs for FFS Medicare beneficiaries, but annual spending per beneficiary on preventive services and tests was 21% higher in Medicare Advantage ($3,811 versus $3,139 in FFS Medicare) whereas FFS Medicare had 17% higher spending on inpatient costs ($3,477 versus $2,898 in Medicare Advantage) and 5% higher spending on outpatient/emergent care services ($2,474 versus $2,359 in Medicare Advantage).
- Average costs for non-dual FFS Medicare enrollees were 10% lower than for non-dual Medicare Advantage beneficiaries in the overall study population ($8,357 versus $9,177 in Medicare Advantage), primarily due to higher spending on preventive services and tests in Medicare Advantage.
- Medicare Advantage outperformed FFS Medicare on several key quality measures, including a nearly 29% lower rate of all potentially avoidable hospitalizations (17% versus 24% in FFS Medicare), 41% fewer avoidable acute hospitalizations, 18% fewer avoidable chronic hospitalizations, and higher rates of preventive screenings/tests, including LDL testing (5% more) and breast cancer screenings (13% more).
Health outcomes and cost savings are significantly better for Medicare Advantage beneficiaries with diabetes—the most clinically complex cohort in which more than 75% of beneficiaries had all 3 chronic conditions in both populations—than for FFS Medicare beneficiaries with diabetes.
- Relative to FFS Medicare, Medicare Advantage beneficiaries in the clinically complex diabetes cohort experienced a 52% lower rate of any complication (8% versus 17% of FFS Medicare) and a 73% lower rate of serious complications (2% versus 6% of FFS Medicare).
- Medicare Advantage achieved a 71% lower rate of serious complications than FFS Medicare for dual eligible patients with diabetes (2% versus 7% of FFS Medicare).
- Medicare Advantage achieved 6% lower average per beneficiary costs than FFS Medicare for all patients in the clinically complex diabetes cohort ($11,635 versus $12,438 of FFS Medicare).
- Medicare Advantage achieved 21% lower average per beneficiary costs than FFS Medicare for dual eligible patients in the clinically complex diabetes cohort ($13,398 versus $16,897 in FFS Medicare).
Dual eligible/low-income subsidy Medicare Advantage beneficiaries with chronic conditions experience significantly better patient outcomes and lower costs savings compared to similar beneficiaries in FFS Medicare.
- Medicare Advantage achieved 17% lower annual costs per dual eligible beneficiary than FFS Medicare ($13,398 versus $11,159 in Medicare Advantage).
- Medicare Advantage dual eligible beneficiaries experienced 33% fewer total hospitalizations (346 versus 516 per 1,000 beneficiaries in FFS Medicare) and 42% fewer emergency room visits (822 versus 1,419 per 1,000 beneficiaries in FFS Medicare).
- Medicare Advantage achieved better patient outcomes among dual eligible beneficiaries, including 49% fewer potentially avoidable hospitalizations for acute conditions based on the quality measure (4% versus 7% of FFS Medicare).
- Medicare Advantage dual eligible beneficiaries had a higher frequency of testing and preventive services than those in FFS Medicare, including a 46% higher rate of breast cancer screening (73% versus 50% of FFS Medicare).
