Underserved MA Beneficiaries Opt for Plans with Supplemental Benefits

Black Medicare Advantage beneficiaries and those with lower income or educational attainment were more likely to choose health plans that include supplement benefits, such as dental and vision coverage, a study published in JAMA Health Forum found.

Each Medicare Advantage plan crafts its own supplemental benefit package using rebate dollars from CMS. More than 90 percent of Medicare Advantage plans offer the three most conventional supplemental benefits: dental, vision, and hearing.

As Medicare Advantage enrollment among racial minorities and low-income beneficiaries grows, it is critical to understand what these traditionally underserved beneficiaries look for in plans.

Researchers used 2018 to 2020 data from the Medicare Current Beneficiary Survey and Medicare Advantage plan data to assess the role of dental, vision, and hearing benefits in enrollment patterns of racial and ethnic minorities, lower-income individuals, and those with lower educational attainment.

The national sample included 8,139 Medicare Advantage beneficiaries. After excluding beneficiaries enrolled in standalone dental, vision, or hearing plans, the sample included 7,516 beneficiaries with dental benefits, 8,026 with vision benefits, and 8,131 with hearing benefits.

More than 83 percent of beneficiaries were White, 40 percent had incomes 200 percent of the federal poverty level or higher, and 65 percent did not complete a college degree. A greater share of racial and ethnic minority beneficiaries, those with lower income, and individuals with less educational attainment were enrolled in plans with a dental, vision, or hearing benefit.

For example, 77.1 percent of Black beneficiaries were enrolled in a plan with dental benefits compared to 68.3 percent of White beneficiaries. Nearly 97 percent of Black beneficiaries and 95.5 percent of White beneficiaries were enrolled in a plan with vision benefits, and 88.2 percent of Black beneficiaries and 85.4 percent of White beneficiaries had a plan with hearing benefits.

Black beneficiaries were 9 percentage points more likely to enroll in a plan with any dental benefit and 11.2 percentage points more likely to enroll in a plan with a comprehensive dental benefit than White beneficiaries. Black beneficiaries also enrolled in plans with a higher average number of dental benefits compared to White beneficiaries, the study noted.

Lower-income beneficiaries and those without a college degree were 4.4 percentage points and 4.7 percentage points more likely to enroll in a plan with a comprehensive dental benefit compared to their higher-income and more educated counterparts.

For vision coverage, Black and Hispanic beneficiaries were more likely to enroll in plans with eye and eyewear benefits than White beneficiaries. Beneficiaries of other or multiple races or ethnicities were 11.5 percentage points more likely to have plans with an eyewear benefit.

Researchers also found that beneficiaries with more than two chronic conditions or fair to poor health status were more likely to enroll in a plan offering an eyewear benefit.

In contrast, beneficiaries of other or multiple races or ethnicities were 7.9 percentage points less likely to enroll in plans with a hearing aid benefit compared to White beneficiaries. They were also enrolled in plans with a lower number of hearing benefits.

These results reinforce previous findings from the Commonwealth Fund indicating that nearly a quarter of Medicare Advantage beneficiaries chose the private programs because of its supplemental benefits.

Policymakers may also want to consider the findings amid current policies aimed at reducing federal payments to Medicare Advantage plans, which could minimize funding for supplemental benefits.

Starting in 2027, CMS will link plan payments with health equity by adjusting star ratings with the Health Equity Index. This policy may incentivize plans to reallocate rebate dollars to alter supplemental benefits to attract or deter certain populations. However, when adjusting offerings, plans should consider the key supplemental benefits that underserved beneficiaries prioritize.