By Debbie Zimmerman

By emphasizing better-coordinated preventive care, Medicare Advantage (MA) plans pave the way to a more patient-centric future health system that prioritizes and rewards quality and cost-effective care.

Today’s highest-rated Medicare Advantage plans have succeeded by properly aligning financial incentives among key players, leveraging data and analytics to find opportunity for clinical improvement and using new technologies to improve the convenience of care delivery.

The rapid growth of MA plans has been one of the major healthcare stories over the last decade or so. Between 2004 and 2017, the number of beneficiaries enrolled in MA plans more than tripled to 19 million, growing from 13% to 33% of all Medicare beneficiaries.

Along with this surge in demand from seniors came an expansion in supply, with large, incumbent health insurers, provider organizations and well-funded startups sponsoring MA plans. In 2019, a total of 3,700 plans are available nationwide, a year-over-year increase of 19%, according to the U.S. Centers for Medicare and Medicaid Services (CMS).

What’s behind MA’s popularity
MA plans offer several advantages to seniors, largely stemming from plans’ incentives in how they’re reimbursed by CMS. Unlike traditional fee-for-service (FFS) Medicare, MA plans are reimbursed with a per-member, per-month amount based on that member’s assessed health risks, meaning that MA plans have the opportunity to more efficiently manage medical expenses by keeping members healthy and avoiding expensive inpatient care at hospitals.

For seniors, this has translated to MA becoming an increasingly appealing and affordable option. In 2019, MA premiums are estimated to have reached their lowest level in three years, down 6% year-over-year to $28 per month, according to CMS. Nearly 83% of MA enrollees who remained in their existing plans had the same or lower premiums in 2019, and approximately 46% of enrollees in their existing plan have a zero premium.

In addition, MA plans provide financial certainty for an increasingly cost-conscious generation of seniors. Since 2011, all MA plans have been required to limit beneficiaries’ out-of-pocket spending for services covered under Medicare Parts A and B to no more than $6,700, according to the Kaiser Family Foundation.

Further, comparison shopping among MA plans is made easier for seniors through the program’s Star Ratings, which provide an overall assessment of a plan’s quality and performance. A plan that includes health services and prescription drug coverage, for example, is given a star rating that grades its quality in multiple areas, including screening tests and vaccines, managing chronic conditions, member experience with the health and drug plans, member complaints about changes in health and drug plan performance, health and drug plan customer service, and drug safety and pricing accuracy. Though imperfect, MA star ratings are among the best-quality assessment tools available to U.S. health consumers.

A new focus on expanded benefits
CMS recently made changes to the types of benefits that MA plans can offer. Once limited to a short list of supplemental benefits, MA plans will have the ability to offer coverage for any goods and services that reduce avoidable emergency department visits or are used to diagnose, prevent, or treat injuries or health conditions.

Going forward, MA plans will be able to offer a wide array of supplemental programs, enabling them to promote overall patient health rather than merely provide care when patients are sick. These new benefits may include a broad range of services, such as therapeutic massage, smoking cessation, in-home support, transportation to medical services and caregiver support.

In addition, plans can offer reduced cost-sharing and additional benefits tailored for enrollees with certain conditions, such diabetes and congestive heart failure. Currently only 270 of the 3,600 overall MA plans are offering these new categories of benefits, but CMS expects more plans to take advantage of this enhanced flexibility with expanded features in the future. CMS also recently approved additional new options, such as covering the cost of fresh produce for patients with heart disease or carpet cleaning for those with asthma.

Taking an innovative and collaborative approach to preventive care
Due to their incentive structure, MA plans have much more motivation than traditional FFS plans to make investments in preventive care. In many cases, this prevention should come in the form of better primary care, such as benefits that provide access to case workers or social workers that can help patients solve needs related to social determinants of health.

Other benefits that can encourage greater use of preventive care include zero copays for visits with primary care physicians or low- or no-cost screenings for breast cancer, colorectal cancer or diabetic eye exams, for example.

For MA plans to be successful, a collaborative approach is essential. True collaborative payers can deliver improved clinical and financial outcomes and an enhanced consumer and provider experience by pursuing the following characteristics. All provider network participants are aligned through shared financial incentives to reduce costs and improve quality. They leverage data and analytics to discover opportunities to improve care or reduced costs by analyzing all available information around utilization, access, setting, cost and quality.

Moreover, these plans also have buy-in at the top of their organizations and have established a governance model that partners with providers and enables strong clinical leadership. Finally, successful MA plans align all operations, benefits and incentives in a collaborative way to better improve the member experience and enhance the consumer-provider relationship.

Collaborative Medicare Advantage plans represent some of the most innovative examples of new approaches to a more consumer-centric, patient-friendly healthcare system. Assuming MA plans continue to drive better health and superior outcomes, look for emerging health plan options for the under-65 crowd that replicate successful collaborative models.

About the author: Debbie Zimmerman, M.D., is the corporate chief medical officer for Lumeris and Essence Healthcare.