WASHINGTON BUREAU — Medicare Advantage plans with relatively low premiums and high levels of cost-sharing ended up with healthier enrollees in 2008 than other Medicare Advantage plans did.
Officials at the U.S. Government Accountability Office have published figures supporting that finding in a summary of results from an analysis of data from 2,899 plans that enrolled 7.5 million Medicare beneficiaries in 2008.
GAO officials prepared the analysis for Democrats on the House Ways and Means Committee and the House Energy and Commerce Committee.
The private organizations that run Medicare Advantage plans are supposed to avoid using premium rates, plan features, or other plan features or underwriting techniques to “cherry pick,” or attract healthier enrollees and repel enrollees with health problems.
“We did not determine whether [Medicare Advantage organizations] structured their plan benefit packages in response to enrolled beneficiaries’ health status or whether beneficiaries of a given health status chose certain MA plans specifically because of their benefit package designs,” James Cosgrove, a GAO director, writes in a letter summarizing the GAO findings.
But, whether intentionally or unintentionally, plans with certain kinds of designs ended up attracting significant healthier enrollees than other plans did, Cosgrove writes.
GAO officials divided Medicare Advantage plans into 3 groups: Good-health plans, in which the members’ average projected health care costs were 10% lower than average; poor-health plans, in which members’ average projected health care costs were 10% higher than average; and average-health plans, with members with projected costs somewhere in the middle.
About 43% of the plans were in the good-health group, 37% in the average-health group and 20% in the poor-health group.
When GAO analysts looked the enrollees, they found that 29% were in plans in the good-health group, 55% in plans in the average-health group, and 16% in plans in the poor-health group.
The monthly Part C Medicare Advantage premium was $24 for the plans in the good-health group, $37 for the plans in the average-health group, and $31 for plans in the poor-health group.
The pattern was different for out-of-pocket costs.
For an inpatient hospital stay of 21 days, for example, the typical enrollee in the poor-health plan paid $746 in “cost sharing,” and the typical enrollee in the good-health plan paid $895. Similarly, the typical enrollee in the poor-health plan would pay $1,802 out of pocket for 156 sessions of kidney dialysis, while the enrollee in the good-health plan would pay $2,118.