Medicare Advantage Boasts Fewer Low-Value Care Services Than FFS Medicare

Low-value care services were less common for Medicare Advantage (MA) beneficiaries—particularly those in health maintenance organizations (HMOs)—than for traditional Medicare (TM) beneficiaries due to certain characteristics of Medicare Advantage coverage, a study published in the JAMA Health Forum found.

“In this cross-sectional study of Medicare beneficiaries, we found that MA beneficiaries received fewer low-value services than TM beneficiaries, especially among MA beneficiaries enrolled in HMO products and those attributed to primary care organizations reimbursed within advanced value-based payment models,” the researchers explained.

The researchers used Medicare Advantage data from a national payer on over 1.5 million beneficiaries and the traditional Medicare data came from a random sample of more than 942,000 Medicare beneficiaries with Medicare Parts A and B. The data observed individuals who had continuous enrollment from 2017 to 2019 or until their death or entering hospice care in 2019.

The study assessed low-value care utilization by analyzing the usage of 26 low-value care services. These services were grouped by categories: clinical category, whether primary care providers or specialists ordered them, and whether they required pre-authorizations in 2019.

After evaluating the utilization levels for these services, the results identified that Medicare Advantage beneficiaries were less likely to receive low-value care.

Specifically, in 2019, they received 9.2 percent fewer low-value care services than traditional Medicare beneficiaries did. There were 23.1 low-value services utilized per 100 Medicare Advantage beneficiaries compared to 25.4 low-value care services for every 100 traditional Medicare beneficiaries.

Medicare Advantage beneficiaries received better care in all of the clinical categories and saw 14 individual low-value services that were less common than in traditional Medicare. Medicare Advantage beneficiaries saw 5 percent fewer low-value cardiovascular tests and procedures and 40 percent fewer low-value cancer screenings.

Both Medicare Advantage beneficiaries in HMOs and Medicare Advantage beneficiaries in preferred provider organizations (PPOs) saw fewer low-value care services. However, HMO beneficiaries had slightly better quality of care.

Medicare Advantage beneficiaries in HMOs saw 2.6 fewer low-value care services per 100 beneficiaries, compared to PPOs which saw 2.1 fewer low-value care services. Moreover, Medicare Advantage members in HMOs saw 13 percent fewer specialist-driven low-value care services per 100 beneficiaries and 2.8 percent fewer low-value care services from primary care providers.

Value-based care arrangements made a difference on these numbers, the researchers indicated. Medicare Advantage beneficiaries whose primary care services were covered under two-sided risk contracts with primary care providers saw the biggest difference in low-value care frequency compared to primary care services covered by traditional Medicare.

However, not all value-based care agreements will produce outstanding results. Upside-only contracts did not demonstrate significant reductions in low-value primary care services compared to traditional Medicare.

“Despite considerable research and policy attention to low-value care in TM, to our knowledge comparatively little is known about low-value care in the MA program,” the researchers noted.

“Our findings have several implications for efforts to reduce low-value care. Within the TM program, in which low-value care has remained prevalent despite policy and research attention, it may be possible to leverage elements of insurance design to encourage the deadoption of low-value services.”

Separate studies have presented a contrasting view. A study of Medicare Advantage and traditional Medicare coverage of low-value care services from 2016 to 2020 found that Medicare Advantage plans did not significantly differ from traditional Medicare in low-value care services utilization. This study did not specifically evaluate the influence of value-based care.