The Importance of Medicare Advantage Plan Design and Impact on Health Equity
Author(s)
Christie Teigland, MA, PhD1, Zulkarnain Pulungan, PhD2, Boris Vabson, PhD3, Scott M. Bilder, PhD4.
1Vice President, Research Science and Advanced Analytics, Inovalon, Bowie, MD, USA, 2Data Insights, Inovalon, Bowie, MD, USA, 3Research Faculty, Harvard Medical School, Boston, MA, USA, 4Director, Research Science and Advanced Analytics, Inovalon, Bowie, MD, USA.
1Vice President, Research Science and Advanced Analytics, Inovalon, Bowie, MD, USA, 2Data Insights, Inovalon, Bowie, MD, USA, 3Research Faculty, Harvard Medical School, Boston, MA, USA, 4Director, Research Science and Advanced Analytics, Inovalon, Bowie, MD, USA.
Presentation Documents
OBJECTIVES: Rapidly growing enrollment in Medicare Advantage (MA) has resulted in an expansion of the types of plans available, partially through government policies like the Medicare Modernization Act. The objective was to understand the implications of various MA plan designs on who enrolls and on post-enrollment healthcare utilization and quality outcomes.
METHODS: We used a nationally representative sample of MA plan data linked to neighborhood-level data on social drivers of health (SDOH) to evaluate outcomes of beneficiaries enrolling in different types of plans after controlling for differences in who enrolls using individual fixed-effects (to adjust for pre-65 utilization), and match-group-by-time-trend controls (to adjust for potential differential trends between matched-groups).
RESULTS: We found financially generous (zero-premium, low co-pay) plans attract more socioeconomically disadvantaged beneficiaries (mean income $75,580 vs $79,981). They are 3x more likely to be non-White (14.8% vs 4.7%), have ≤high school education (36.2% vs 33.4%), and low English proficiency (4.2% vs 1.4%). Health Maintenance Organization (HMO) plans have >25% lower utilization than Preferred Provider Organization (PPO) plans for the same population. Regression analyses show $615 lower per-person-per-quarter-costs under HMOs vs PPOs.
CONCLUSIONS: Individual MA plans differ markedly in terms of financial generosity and coverage design, and these features impact who enrolls and health outcomes post-enrollment. Findings show that managed care provisions can substantially reduce costs. Results can help plans understand expected performance of different design types, identify offerings that will deliver the best overall quality and cost outcomes, facilitate planning for resources needed to care for new enrollees (e.g., types of specialty providers, availability of hospitals), and identify SDOH that must be addressed to achieve health equity. For policymakers, the findings reveal the significant value MA plans offer—particularly their appeal to socioeconomically disadvantaged groups. Findings confirm that a strategic mix of MA plan options can enhance Medicare's benefits, potentially supporting financial sustainability.
METHODS: We used a nationally representative sample of MA plan data linked to neighborhood-level data on social drivers of health (SDOH) to evaluate outcomes of beneficiaries enrolling in different types of plans after controlling for differences in who enrolls using individual fixed-effects (to adjust for pre-65 utilization), and match-group-by-time-trend controls (to adjust for potential differential trends between matched-groups).
RESULTS: We found financially generous (zero-premium, low co-pay) plans attract more socioeconomically disadvantaged beneficiaries (mean income $75,580 vs $79,981). They are 3x more likely to be non-White (14.8% vs 4.7%), have ≤high school education (36.2% vs 33.4%), and low English proficiency (4.2% vs 1.4%). Health Maintenance Organization (HMO) plans have >25% lower utilization than Preferred Provider Organization (PPO) plans for the same population. Regression analyses show $615 lower per-person-per-quarter-costs under HMOs vs PPOs.
CONCLUSIONS: Individual MA plans differ markedly in terms of financial generosity and coverage design, and these features impact who enrolls and health outcomes post-enrollment. Findings show that managed care provisions can substantially reduce costs. Results can help plans understand expected performance of different design types, identify offerings that will deliver the best overall quality and cost outcomes, facilitate planning for resources needed to care for new enrollees (e.g., types of specialty providers, availability of hospitals), and identify SDOH that must be addressed to achieve health equity. For policymakers, the findings reveal the significant value MA plans offer—particularly their appeal to socioeconomically disadvantaged groups. Findings confirm that a strategic mix of MA plan options can enhance Medicare's benefits, potentially supporting financial sustainability.
Conference/Value in Health Info
2025-05, ISPOR 2025, Montréal, Quebec, CA
Value in Health, Volume 28, Issue S1
Code
HPR140
Topic
Health Policy & Regulatory
Disease
No Additional Disease & Conditions/Specialized Treatment Areas