Medicare Advantage plans are a private insurance alternative to original Medicare Parts A (hospitalization), B (physicians and out-patient care), and D (prescription drugs) that provide a managed healthcare plan paid for with a monthly capitated fee (Medicare pays the plan a set amount each month). Original Medicare, in contrast, provides insurance for the same medical services but pays healthcare providers a predetermined fee for service directly from the government agency instead of through any managed healthcare plan administered by a private insurance company.
Medicare Advantage plans provides coverage for some additional medical services (Medicare Part C) — annual physical exams, wellness care, dental, hearing, and vision. Most importantly, Medicare Advantage plans include an annual out-of-pocket expense cap. With original Medicare, there is no cap on annual out-of-pocket expenses.
Medicare Advantage was a compromise with Republicans to provide a “market-based” alternative to the “socialistic” original Medicare program.
The problem is that even though the government has carefully tracked metrics regarding the care received by Medicare Advantage enrollees (and the money spent to treat them) since 2012, this data has never been made public. Medicare shares the data it tracks on the 38 million original Medicare enrollees.
These Medicare Advantage plans now cover more than one third of the 58 million Medicare beneficiaries. The government is transferring an enormous amount of money to those private insurance company with precious little public knowledge about efficiencies and outcomes.
Medicare had pledged to release the 2014 Medicare Advantage data late last month. At the last minute the data release was cancelled; the Centers for Medicare and Medicaid Services (CMS) said there were questions about the data’s accuracy. CMS will re-evaluate the data release after analyzing the data for 2015.
Niall Brennan, formerly the chief data officer of CMS, who worked on the data analysis tweeted his disappointment and concern about CMS backsliding on open data:
Hugely disappointing to see @cmsgov MA data session cancelled @ #arm17 – hope CMS not backsliding on #opendata @charlesornstein @fredtrotter pic.twitter.com/xbHzu4KbU9
— Niall Brennan (@N_Brennan) June 25, 2017
When asked on Twitter about potential problems in the data, Brennan responded with a curt “… if it [the data] was used for payment, why can’t it be used for research?” tweet:
like any new data source MA data had some quirks to be sure but if it was used for payment why cant it be used for research
— Niall Brennan (@N_Brennan) June 27, 2017
Medicare Advantage plans offered by private insurers have been accused of overcharging Medicare. Charles Ornstein writing for ProPublica reports that in 2016, the Center for Public Integrity reported that more than 36 audits found that Medicare Advantage plans “overstated the severity of enrollees’ medical conditions to garner more money.” And by not just a little bit. “In 2014, the Center’s reporting suggested that insurers had collected US$70 billion in improper payments from 2008 – 2013,” writes Ornstein.
Ornstein reports that in two separate cases, the US Department of Justice intervened in two federal lawsuits alleging UnitedHealth Group of providing “‘untruthful and inaccurate information about the health status of beneficiaries’ to boost its revenues.”
There are likely only four possible reasons for CMS’s last-minute cancellation of the data release:
- The data indicates Medicare Advantage costs significantly more than original Medicare and delivers worse outcomes.
- The data indicates Medicare Advantage costs significantly less than original Medicare and delivers worse outcomes.
- The data indicates Medicare Advantage costs significantly more than original Medicare and delivers equal or better outcomes.
- The data indicates Medicare Advantage costs significantly less than original Medicare and delivers equal or better outcomes.
My money’s on number one: Medicare Advantage most likely costs significantly more than original Medicare and delivers worse or nearly equal outcomes.
Maybe we’ll get something close to an answer next year.
Canonical source: CMS hastily cancels release of Medicare Advantage data.
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