Home care is increasingly offered under Medicare Advantage (MA) plans, often squeezing providers with thin margins. Despite the rising market share of MA, a new study shows that a “slight” number of consumers have chosen to switch to traditional Medicare.
Currently, over 35.7 million Americans are enrolled in the MA plan. However, researchers at the University of Michigan University of Michigan in Ann Arbor found that it was one of the switch to traditional Medicare during open registration.
Using data from the 2015-2020 Medicare Current Beneficiary Survey, researchers found that while MAs are increasingly popular, they have experienced the removal of critical plans among high-risk Medicare beneficiaries due to limited access to necessary care and dissatisfaction with the quality of care received.
Research shows that every five years, half of MA enrollees switch from one MA plan to a different MA plan and exit 10% of traditional service fee Medicare.
The researchers also found that access issues were the main reason why beneficiaries abandoned MA completely and returned to traditional Medicare. This was a much more common reason than the difference in cost.
Dr. Jeffrey Hoffman, an associate professor at the University of Michigan nurse, was surprised to see the difference in the liberation factors for people switching between MA plans and traditional Medicare and leaving MA towards traditional Medicare. “This highlights the downsides of utilization management, which limits the type and amount of care that subscribers receive and allows them to leave the MA plan.”
The theoretical benefit of MA planning in the private market is that people can shop as their needs progress, Hoffman said. But in reality, people often need to experience healthcare first-hand before they can understand whether different plans are better suited to their needs.
Those who switch to traditional Medicare have more health care needs than those who continue to be enrolled in MA. Research shows that their decisions are driven more strongly by dissatisfaction with access to care based on the MA plan.
Customer satisfaction
Consumers who switched from MA plans to another form of Medicare were more likely than those who would stay to report challenges in access to care, along with complaints about the cost and quality of care they received.
However, cost alone was not the driver of switching plans. Instead, factors such as lack of access to care, low quality, low planster ratings, and the benefits of generous fringes played a more important role in the decision to quit.
“Interestingly, while complaints about costs are not a factor, planning generosity is a factor that switches MA plans,” Hoffman said. “While enrollees may think about premiums when reflecting planning costs, plan generosity refers to out-of-pocket costs, such as out-of-pocket costs of clinical services. Registrants may prefer a low MA premium, but may express frustration with fewer transparent costs, which can limit access to the care they need.”
Hoffman also noted that participants are more likely to choose plans that offer additional perks beyond those offered by traditional Medicare plans, such as fitness program discounts and meal delivery.
Consumers who report difficulties in accessing care are more likely to switch from MA to traditional Medicare, and do not limit the choice of physicians or hospitals available to enrollees.
Approximately 15% of people reportedly in poor health, twice as likely to report difficulty accessing care when other MA enrollees are needed, three times as likely to be dissatisfied with the quality of care, and are dissatisfied with the cost of care and professional care.
Despite this complaint, Hoffmann believes MA registrations will continue to increase.
“At the traditional Medicare exit from MA, it's generally quite low, at 3.5% each year, but the switch from MA to MA is very common,” Hoffman said. “(Consumers) may continue to register with MA because it feels so much — and for others, disappointment may come. The exit fee is very high for those with poorer health conditions or those using more health services.
