The Medicare Advantage program launched in 1985 as a method to broaden entry to coordinated care and complete advantages, and to carry efficiencies and value financial savings to Medicare by leveraging private-sector managed care. While necessary debate continues on the worth of managed care typically, beneficiaries are overwhelmingly happy with Medicare Advantage, enrollment in this system is rising yr over yr, and taking part managed care plans are providing a quickly rising array of latest and progressive advantages. These progressive advantages are a key function of the Medicare Advantage program that differentiates it from conventional Medicare and a key cause for this system’s recognition amongst Medicare beneficiaries. As coverage makers debate the longer term function of personal Medicare plans, they should consider the preferences of Medicare beneficiaries and construct on present improvements, resembling supplemental advantages.
Since the creation of Medicare Advantage, the Centers for Medicare and Medicaid Services (CMS) has required personal taking part plans to take a position financial savings from efficiencies into advantages that “supplement” Medicare or cut back beneficiary prices. In the early years of this system, these advantages sometimes took the type of lowered value sharing for beneficiaries together with protection of prescribed drugs (earlier than the creation of the Part D profit), dental, and imaginative and prescient. For a lot of the program’s historical past, CMS has circumscribed supplemental profit choices by requiring that they be primarily associated to the member’s well being wants.
Non-Medical Supplemental Benefits
More just lately, nonetheless, Medicare Advantage supplemental advantages have advanced significantly. While plans are nonetheless more likely to cut back value sharing for beneficiaries and canopy dental and imaginative and prescient, they now have extra choices to supply progressive, non-medical advantages. Through the Bipartisan Budget Act of 2018, Congress started permitting Medicare Advantage plans to supply “special” supplemental advantages for the chronically sick that aren’t primarily well being associated (with sure guardrails), opening the door for advantages which might be social service in nature, resembling meals, non-medical transportation, pest management, companion care, and lease subsidies. Later that very same yr, CMS expanded the definition of “primarily health related” supplemental advantages, opening the door much more and permitting non-medical advantages that assist forestall or tackle cognitive and useful decline, resembling respite care and in-home helps. Together, these coverage actions marked a major turning level in Medicare historical past and at no further value to taxpayers—arguably probably the most vital coverage turning level for the reason that creation of the Part D drug profit, and perhaps probably the most vital for the reason that creation of Medicare Advantage.
Medicare plans are leaning into this coverage alternative. The variety of plans providing non-medical advantages has tripled over the previous three years, from 626 to 1,851. Currently, 34 % of Medicare plans supply no less than one non-medical profit (exhibit 1). Medicare Advantage Special Needs Plans (SNPs) are particularly more likely to supply these advantages. In 2022, 42 % of SNPs provided Special Supplemental Benefits for the Chronically Ill. This remains to be wanting the 99.9 % of Medicare plans providing any kind of supplemental profit, however the year-over-year development is notable. These non-medical advantages vary from meals and transportation to social isolation options and residential modifications.
Exhibit 1: Growth in non-medical supplemental advantages, 2020–22
Source: ATI Advisory evaluation, reproduced with permission.
The current Medicare coverage shifts towards non-medical advantages have drawn enthusiastic consideration from shopper advocates, coverage makers, and researchers. While the idea of “non-medical” has been part of the Medicaid program for many years, Medicare has traditionally been restricted by necessities round “medically skilled care” and an “improvement or maintenance standard”—neither of that are within the spirit of addressing the entire individual, which incorporates upstream non-medical wants.
The development in supplemental advantages choices—together with these assembly social wants resembling meals, diet, transportation, and in-home assist companies—exhibit Medicare Advantage plans’ curiosity in addressing social determinants of well being and enhancing the whole-person well being of their beneficiaries. The flexibility offered has allowed Medicare Advantage plans to innovate and take a look at new profit choices which have the potential to enhance the standard of care and outcomes for weak and at-risk beneficiaries.
In addition to the dramatic year-over-year enhance within the providing of non-medical supplemental advantages proven above (see additionally Milliman report), early findings on the advantages are promising, with results resembling lowered loneliness, improved bodily and psychological well being days, and improved medicine administration. In gentle of those early findings and speedy development in choices, coverage makers and stakeholders understandably need to know extra about how beneficiaries are utilizing supplemental advantages and the ensuing impression on enhancing well being outcomes.
Challenges To Benefit Evaluation
However, there are a variety of distinctive challenges that include evaluating the impression of non-medical supplemental advantages. First, analysis means that the complete impression of social service and different non-medical advantages could take years to develop. While there could also be a direct impact of improved psychological well-being or lowered starvation and a extra nutritious weight-reduction plan, the metrics coverage makers usually look to as proof of constructive outcomes and the outcomes our programs are in a position to readily measure, resembling lowered Medicare spending, take time. By the time these financial savings accrue, the beneficiary could have modified well being plans, additional hindering correct analysis.
Second, there are different elements to account for, resembling the supply of household caregivers, Older American Act (OAA) applications, and different neighborhood applications which might be filling the gaps in our well being care system. For instance, the OAA diet program provides 900,000 meals to older adults day-after-day (greater than 300 million per yr), separate from these underneath Medicare Advantage.
Additionally, researchers battle to isolate the impression of particular advantages to check outcomes between beneficiaries who obtain them and those that don’t. Within a Medicare Advantage plan, people with comparable ranges of want are more likely to qualify for comparable advantages, and throughout completely different Medicare Advantage plans, there are completely different medical fashions, supplier networks, and different myriad elements influencing well being—that means there isn’t any “control” group.
As a outcome, it’s troublesome to judge the direct impression of non-medical supplemental advantages on Medicare beneficiary outcomes, particularly if utilizing conventional outcomes resembling medical spending and hospitalizations. The fast results are sometimes extra refined. As one Medicare Advantage plan consultant we interviewed described for example, “[The member] was temporarily bedbound and her daughter caring for her was completely overwhelmed. Her daughter was so grateful to learn about the respite [supplemental] benefit—it helped tide the member over until she was able to get back on her feet.”
The Way Forward
Does this imply we shouldn’t consider supplemental advantages? No. These advantages are clearly a important a part of the worth proposition of Medicare Advantage. However, recognizing the challenges that include measuring worth, it will likely be important to assemble the correct constructing blocks:
- Start small. There is lots to do earlier than we consider outcomes, which would require appreciable information assortment to happen. Beginning in 2023, Medicare Advantage plans should report expenditure information to CMS on a wide range of supplemental advantages as a part of Medical Loss Ratio reporting. CMS may begin through the use of these information to know normal use and entry developments. As an incremental subsequent step, CMS may additionally add supplemental advantages into encounter reporting, recognizing that it’s going to take time for sure forms of non-medical suppliers to develop core information reporting capabilities wanted for encountering.
- Agree on the outcomes of curiosity. Often, coverage makers and different stakeholders give attention to lowered medical use and spending as major outcomes of curiosity. These outcomes make sense in a managed atmosphere or when evaluating complete applications to different complete applications. However, it’s unlikely one would confidently know whether or not particular supplemental advantages alone impression Medicare Advantage members’ hospitalizations, emergency division use, or general Medicare spending. What could be seen, although, is the impression of those advantages on fast well-being and satisfaction via member surveys. CMS may (and may) have a look at the demographics of people enrolled in plans providing sure supplemental advantages, to start to gauge equitable entry in choices.
- Consider a Center for Medicare and Medicaid Innovation (Innovation Center) demonstration. If CMS and Congress are eager about understanding the consequences of particular supplemental advantages, there may be at the moment a mechanism to check this: an Innovation Center demonstration. CMS may design a rigorous examine round particular advantages within the fee-for-service or Medicare Advantage applications. This would enable for testing in a managed method that minimizes destructive outcomes for beneficiaries (for instance, if reporting is so burdensome it causes a lower in advantages). CMS may additionally construct on the Value-Based Insurance Design (VBID) demonstration and information collected via it. The VBID demonstration permits Medicare plans to focus on profit design to enrollees based mostly on persistent situations or socioeconomic traits and incentivize using advantages via rewards and incentives. As a part of this demonstration, CMS is gathering information on advantages.
- Address workforce limitations. The success of supplemental advantages hinges on supplier capability and functionality to ship companies to a Medicare inhabitants. For non-medical supplemental advantages, the suppliers wanted are sometimes direct care staff and different professionals which might be in brief provide. Fulfilling the promise of supplemental advantages finally will depend on a lot bigger issues in our well being and long-term care service financial system. CMS and Congress can begin to tackle workforce capability via technical help, profession growth applications, and caregiver helps.
Understandably, stakeholders are desperate to know the impression of supplemental advantages on Medicare beneficiary well-being and whether or not non-medical interventions stay as much as the promise of stopping pointless hospitalizations and emergency division visits. Innovations could make a significant distinction to Medicare beneficiaries by filling the gaps of their different protection sources and decreasing their out-of-pocket prices through value share buy-downs.
Before we push too far on evaluations and information reporting, we have to construct the analysis infrastructure, which requires funding, incentives, studying collaboratives, and considerate reporting necessities and information requirements. Rushed program and coverage modifications may cut back or undermine advantages by creating administrative burdens that plans and suppliers aren’t in a position to accommodate, or by wrongfully drawing conclusions on incomplete information. Supplemental advantages are significant to Medicare beneficiaries and fill gaps that exist within the conventional Medicare program, and our approaches to understanding the worth of supplemental advantages ought to be anchored in that recognition.
Authors’ Note
Authors are staff of ATI Advisory, which offers consultancy companies. This venture was funded by Better Medicare Alliance.