Racial Care Disparities May Be Lower in Medicare Advantage Plans

Medicare Advantage plans may better address racial care disparities than fee-for-service Medicare, according to the second in a series of reports that ATI Advisory has prepared for Better Medicare Alliance (BMA) in 2021.

“With over 26.5 million beneficiaries enrolled in Medicare Advantage today, this report shows that minority beneficiaries are a driving force behind these enrollment gains; turning to Medicare Advantage to meet their health and social needs. When policymakers stand up for Medicare Advantage, they stand up for these seniors, too,” Allyson Y. Schwartz, president and chief executive officer of the Better Medicare Alliance, said in the press release.

Around half of all Black Medicare beneficiaries and 53 percent of Latinx Medicare beneficiaries are in a Medicare Advantage plan, the report found. In contrast, only 34 percent of White beneficiaries and 31 percent of those who identified as “Other” races were enrolled in a Medicare Advantage plan.

Latinx Medicare beneficiaries and Black Medicare beneficiaries tended to have lower income levels than White Medicare beneficiaries.

Among Black beneficiaries, 77 percent of those in Medicare Advantage plans had incomes that were 199 percent of the federal poverty level or below. In fee-for-service Medicare, 69 percent of Black beneficiaries fell into this income bracket.

Eight in ten Latinx Medicare Advantage beneficiaries had incomes that were 199 percent of the federal poverty level or below and 63 percent of fee-for-service Medicare beneficiaries who identified as Latnix were in the same income bracket.

In contrast, 44 percent of Medicare Advantage beneficiaries who identified as White had incomes of 199 percent of the federal poverty level or lower, and in fee-for-service Medicare this share dropped to 35 percent among White beneficiaries.

Medicare Advantage plans also had more dual-eligible beneficiaries than the total number of dual-eligible beneficiaries in Medicare among Black beneficiaries, Latinx beneficiaries, and White beneficiaries.

Latinx Medicare Advantage beneficiaries were more likely to struggle with speaking English than those enrolled in fee-for-service Medicare.

“This difference in comfort with English between Traditional FFS Medicare and Medicare Advantage beneficiaries, combined with the greater likelihood of Latinx individuals to be enrolled in Medicare Advantage, reflects the importance of health literacy efforts and culturally sensitive health care,” the report stated.

The report also found that there were differences in internet usage between Black beneficiaries, Latinx beneficiaries, and White beneficiaries. White beneficiaries in both fee-for-service Medicare and Medicare Advantage plans far outstripped Black beneficiaries and Latinx beneficiaries in their internet usage.

Sixty-one percent of White beneficiaries in fee-for-service Medicare used the internet every week and 56 percent in Medicare Advantage plans said the same. Meanwhile, 44 percent of Black beneficiaries in fee-for-service Medicare and 33 percent of Black beneficiaries in Medicare Advantage used the internet weekly.

Frequent internet usage was even lower among Latinx beneficiaries. In fee-for-service Medicare, 36 percent used the internet every week, and in Medicare Advantage, that number dropped to 30 percent.

This distribution of internet usage across races and Medicare coverage types could be significant as the industry leans into telehealth and remote patient monitoring solutions after the coronavirus pandemic.

Medicare Advantage beneficiaries also had higher preventive service utilization in nearly every category that the report addressed and across all three races studied. 

For example, ten percent more Black Medicare Advantage members received the flu shot than Black fee-for-service Medicare beneficiaries did. Among White beneficiaries, the difference was four percent higher for Medicare Advantage members, and among Latinx beneficiaries the difference was three percent higher for Medicare Advantage members.

Moreover, out-of-pocket spending was lower for all of the races that the report studied. Black beneficiaries saw more than $1,200 in savings as Medicare Advantage members, Latinx beneficiaries saved more than $1,100 on out-of-pocket healthcare spending, and White beneficiaries saw over $1,500 in savings by being in a Medicare Advantage plan.

Based on this data, the BMA report concluded that Medicare Advantage plans were better equipped to reduce racial care disparities for Medicare beneficiaries.

“As the data show, Black and Latinx beneficiaries are likely to enroll in Medicare Advantage and these beneficiaries are likely to be more socioeconomically disadvantaged than minority beneficiaries in Traditional FFS Medicare,” the researchers noted. 

“Our research also finds they are more likely to receive important preventive services and spend considerably less out-of-pocket on health care than racially and ethnically diverse beneficiaries in Traditional FFS Medicare.”

The report urged policymakers to continue upholding the Medicare Advantage model, which does receive bipartisan support in Congress.

The first report that BMA released in this series emphasized that Medicare Advantage plans attracted more members with chronic disease management needs. The most recent Humana Bold Goal report also found that Medicare Advantage members saw better patient outcomes than beneficiaries in fee-for-service Medicare.