Medicare Advantage COVID-19 Hospitalizations Were Lower Than FFS

Updated 11/10/21: This article has been updated to elucidate the differences between Medicare Advantage beneficiaries' and fee-for-service Medicare beneficiaries' use of telehealth and virtual care when they did not own the appropriate technologies. Medicare Advantage beneficiaries without the proper technologies were able to access telehealth and virtual care more frequently than fee-for-service Medicare beneficiaries in a similar condition.

Medicare Advantage coronavirus-related hospitalizations were lower than fee-for-service  Medicare’s rates from January through November 2020, a Better Medicare Alliance report found.

ATI Advisory compiled the report on behalf of Better Medicare Alliance using data from the MCBS Fall 2020 Community Supplement Public Use Files and Medicare Claims Data.

Overall, Medicare beneficiaries experienced hospitalization for coronavirus at a rate of 759 hospitalizations for every 100,000 beneficiaries. 

However, when experts broke the data down into fee-for-service Medicare hospitalizations and Medicare Advantage hospitalizations, the trend was clear. Fee-for-service Medicare averaged around 788 coronavirus hospitalizations for every 100,000 beneficiaries, while Medicare Advantage saw 664 coronavirus hospitalizations for every 100,000 beneficiaries.

Although there are more fee-for-service beneficiaries than Medicare Advantage beneficiaries, the size of the programs did not account for the differences in outcomes. Age also did not appear to be a factor in the higher hospitalization rate.

Fee-for-service Medicare beneficiaries accounted for 60 percent of the Medicare population but contributed 64 percent of the Medicare coronavirus-related hospitalizations during the study’s timeframe.

Moreover, despite the fact that the Medicare fee-for-service population in the study skewed younger, hospitalized fee-for-service beneficiaries were more likely to pass away due to the disease.

Over one in five fee-for-service Medicare beneficiaries who were hospitalized for coronavirus died during their hospitalization. In contrast, 15 percent of Medicare Advantage beneficiaries who were hospitalized for coronavirus died due to the pandemic.

There were no significant differences between fee-for-service and Medicare Advantage beneficiaries regarding the likelihood of receiving a coronavirus test, although Medicare Advantage beneficiaries were more likely to have tested positive by November 2020.

Approximately the same share of beneficiaries in fee-for-service Medicare and Medicare Advantage expressed hesitancy to receive the coronavirus vaccine. But at the time of the study, coronavirus vaccines were not widely available in the market.

While fee-for-service Medicare and Medicare Advantage were able to achieve approximately the same access to care overall, certain services were more available to Medicare Advantage beneficiaries than to their fee-for-service counterparts. For services such as ongoing condition treatment, dental care, and diagnostic care, Medicare Advantage beneficiaries were more likely to have access to care.

Medicare Advantage performed particularly well for dually-eligible beneficiaries, helping them get to regular checkups, urgent care visits, receive ongoing treatment, and get a diagnostic during the pandemic.

Although a smaller share of Medicare Advantage beneficiaries had access to the internet or technologies with internet access compared to fee-for-service Medicare beneficiaries, Medicare Advantage beneficiaries were more likely to have access to telehealth services than their fee-for-service counterparts, pre-pandemic. 

Also, Medicare Advantage beneficiaries who did not own a smartphone were still able to access telehealth and virtual care options. For fee-for-service Medicare beneficiaries without such technologies, this capability was less common.

The report noted one disparity that Medicare Advantage beneficiaries experienced regarding coronavirus treatment. Medicare Advantage beneficiaries who identified as Black and Latinx had a lower rate of coronavirus testing than Black and Latinx fee-for-service beneficiaries. 

However, Black and Latinx Medicare Advantage beneficiaries were also more likely to engage in 11 to 15 types of coronavirus prevention behaviors than fee-for-service beneficiaries.

“As we integrate lessons from the COVID-19 pandemic and equip ourselves for future health crises, policymakers should consider whether there are lessons that can be drawn from the ability of Medicare Advantage to meet certain needs of its program populations and applied to the Medicare program generally,” the report concluded.

Medicare Advantage health plans have the flexibility to offer additional benefits outside of what fee-for-service Medicare provides. 

In plan year 2021, more Medicare Advantage plans leveraged those flexibilities to address coronavirus-related needs. Over a third of plans extended coronavirus benefits such as sending out care packages, reducing coronavirus-related cost-sharing, cover personal protective equipment, or reimburse COVID-19 testing as a supplemental benefit.

However, concerns grew on the popular and industry levels as payers, including Medicare Advantage plans, began to eliminate cost-sharing waivers for coronavirus treatment. An American Journal of Preventive Medicine study noted that the mean cost for seniors’ flu treatment in 2018—which has a comparable price tag to coronavirus treatment—was $987.

Payers have shifted their strategy to keep seniors in the home, instead of bringing them into the hospital setting for treatment. Experts told HealthPayerIntelligence that bundling services and using remote patient technologies can help Medicare Advantage members stay out of the hospitals while still receiving high quality care.