Proceed With Caution: Medicare Advantage and Access to High-Quality Specialists

By Simon F. Haeder, Assistant Professor of Public Policy at The Pennsylvania State University

From Health Services Research and Managerial Epidemiology

“In 1965, the U.S. Congress under the leadership of President Johnson transformed health insurance for older Americans by establishing the Medicare program, a social insurance program designed to provide health insurance coverage to most of America’s seniors. And no doubt, the program has significantly improved the lives of its beneficiaries by protecting their health and finances. It comes as no surprise then that Medicare enjoys high popularity amongst the American public. Indeed, over time, expanding Medicare to all Americans has become the rallying cry for advocates of universal coverage in the United States.

Yet over the last decade or so, more and more senior Americans have been choosing to forgo traditional Medicare benefits. In its place, they are opting to obtain insurance coverage via the Medicare Advantage program, an option available to seniors that exclusively relies on private insurance carriers to provide insurance coverage instead. Indeed, while just 15 years ago only 13 percent of Medicare beneficiaries opted out of traditional Medicare, today more than one in three do so. More growth is expected over the next decade. In some states like California, Minnesota, and Oregon, enrollment is approaching 50 percent, and in Puerto Rico it is approaching three in four.

Yet, we know remarkably little about the experience of those making the transition. As my recently published research indicates, for some, particularly those outside of large metropolitan areas, this trade comes with significant costs in terms of health care access and provider quality.

What is Medicare Advantage and Why Is Enrollment Growing?

Medicare Advantage, previously known as Medicare Part C and Medicare+Choice, was created in the 1970s to offer Medicare beneficiaries the option to obtain their benefits from private health plans. Medicare Advantage covers not only the same medical services as its sister program, but it often adds additional services ranging from dental and vision coverage to gym memberships and health education programs. As many of the available plans come without additional premiums, and with widespread political support, it is hardly surprising that enrollment in the program has increased dramatically.

Yet, there is a catch. Medicare Advantage enrollees forgo the standard fee-for-service structure of traditional Medicare that allows them to see any provider of their choice. Instead, they are restricted to the provider network offered to them by their insurance carrier–or pay significant out-of-pocket costs.

A Note of Caution: Medicare Advantage Provider Networks

While many Medicare Advantage beneficiaries are happy with their new private insurance plans, not everything that glitters is gold. In the case of Medicare Advantage, this holds true for at least some of the enrollees. My recent research looked at access to high-quality specialists in California, a state with some of the highest enrollment numbers for the program. Specifically, I analyzed provider networks for endocrinologists, obstetricians and gynecologists (OB-GYNs), and cardiologists. My findings indicate that for those Californians living in large metropolitan areas, there is little cause for concern, as beneficiaries at times even fare better than their peers in traditional Medicare.

Yet for those outside these areas, problems in terms of access and provider quality quickly became apparent. That is, with increasing degrees of rurality, Medicare Advantage beneficiaries, restricted to providers within networks offered by their insurance carriers, fared progressively worse than those in traditional Medicare, who can receive care from any provider accepting Medicare in terms of access in general, and in particular to higher quality providers.

In light of President Trump’s recent executive order seeking to further grow enrollment in Medicare Advantage and loosening oversight and regulation of provider networks, my research serves as a note of caution. Even small increases in travel distance can pose a significant challenge for many senior Americans, affecting access to care with potentially significant implications for their health. More work is necessary to truly determine the health impacts for those challenged by overly restrictive provider networks. For now, seniors are well-advised to take a good look at their provider networks before signing up for Medicare Advantage.”

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Article Details:

Quality Regulation? Access to High-Quality Specialists for Medicare Advantage Beneficiaries in California

Simon F. Haeder

DOI: 10.1177/2333392818824472

From Health Services Research and Managerial Epidemiology

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