Unbiased Analysis of Today's Healthcare Issues

VBID comes to Medicare Advantage

CMS announced last week that they are extending their value-based insurance design (VBID) program to more states and more patients.  I describe VBID and the proposed changes below. What is VBID? Value-Based Insurance Design (VBID) generally refers to health insurers’ efforts to structure enrollee cost sharing and other health plan design elements to encourage enrollees […]

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Impact of Medicare Advantage on Hospital Admissions

Do patients who enroll in Medicare Advantage go to the hospital less frequently? The answer is yes. However, this fact may not be causal. Patients who enroll in Medicare Advantage are generally younger and healthier than patients who enroll in Medicare’s fee-for-service (FFS) program. A paper by Duggan, Gruber and Vabson (2016) uses a novel […]

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Why Medicare Advantage is thriving

In the 1990s, managed care began to take over the health care marketplace. However, backlash against managed care lead to a retrenchment in managed care in the late 1990s.  A paper by Sinaiko and Zeckhauser (2015) notes that: After the MA-plan payment cuts imposed through the Balanced Budget Act of 1997, HMO availability dropped by nearly […]

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Does tying payment to quality improve quality?

Although the typical economist answer would be yes, in the case of one Medicare Advantage program, the answer is ‘no’. A paper by Layton and Ryan (2015) [earlier draft] examine the Medicare Advantage Quality Bonus Payment Demonstration (MA QBP) which began in 2012.  In this program: …plans receive bonus payments based on an overall plan quality […]

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2015 Medicare Advantage Enrollment

About two-thirds of Medicare beneficiaires are enrolled in tradiational Medicare FFS, but the remaining thrid is now enrollingin Medicare Advantage plans.  Which plans are dominant? The following figure from Avalere provides a breakdown. Note that this figure obscures significant regional variation in plan market share. For instance, Kaiser Permanente has almost half (48%) of the […]

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What’s new for Medicare Advantage in 2015

A KFF article provides some highlights of changes to Medicare Advantage for 2015: Near universal access to an MA plan.  99% of Medicare beneficiaries will have access to a Medicare Advantage plan as an alternative to traditional Medicare in 2015.  The only individuals without access to an MA plan are concentrated in a few rural areas. Lots of […]

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Medicare Advantage Plans: Thumbs Up or Down?

Austin Frakt says although Medicare Advantage plans used to be considered high cost, low-quality options, in recent years, these Medicare Advantage plans have vastly increased quality of care and have become less focused on cream-skimming healthier patients.   Medicare Advantage plans — private plans that serve as alternatives to the traditional, public program for those […]

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Was Newt Gingrich Right about Medicare?

In 1995, Newt Gingrich claimed that Medicare would end. He stated that “going to wither on the vine because we think people are voluntarily going to leave it — voluntarily.”  Was he right? In the one hand, Medicare total enrollment and spending is rising and the program still has widespread political support. On the other […]

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Medicare Advantage Plan’s Response to Risk Adjustment

Medicare beneficiaries have the option to enroll in private plans to have them operate their benefits rather than use the tradiational Medicare Fee-for-services (FFS) program.  Medicare pays these private plans, known as Medicare Advantage (MA) plans, premiums based on the health status of their enrollees.   Medicare uses a risk score to measure beneficiary health status. […]

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Measuring Patient Case Mix in Medicare

How does Medicare measure patient case mix?  For the most part, Medicare uses the Hierarchical Condition Category (HCC) model.  A recent CMS presentation describes the HCC model in more detail.  Today I review where CMS applies the HCC model, provide an overview of the HCC methodology, briefly describe its performance, and give some background on […]

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