Medicare Advantage enrollees with cancer spend 35% less out of pocket on their medical care than beneficiaries enrolled in traditional Medicare only, according to a new study.
The survey, conducted by ATI Advisory and commissioned by the Better Medicare Alliance, found that 15% of Medicare Advantage (MA) enrollees with cancer were likely to be “cost-burdened” by health care costs, compared to 23% of traditional Medicare recipients with cancer.
Cost-burdened is defined as someone who spends 20% or more of their income on health care expenses.
The results of the survey reflect the significant out-of-pocket cost savings that may be realized in MA plans compared to fee-for-service Medicare. The biggest difference is that there is no yearly limit on what you pay out of pocket in a fee-for-service Medicare plan, unless you also enroll in a Medicare Supplement (Medigap) plan.
MA plans, on the other hand, have annual limits on what you pay out of pocket for services that Medicare Part A and Part B cover. Once you reach your plan’s limit, you’ll pay nothing for services Parts A and B cover for the rest of the year.
Why costs may be less with MA plans
According to the report, MA plans are more apt than traditional Medicare to emphasize:
- Screening and health risk assessments to detect cancers or potential cancers as early as possible in its progression. This improves outcomes and reduces cost of care in the long term.
- Care management that simplifies care navigation. MA beneficiaries with cancer are likely to qualify for more intensive care management programs. Care management services differ by MA plan, but typically involve an interdisciplinary care team with an established care manager lead who coordinates an enrollee’s clinical, behavioral, pharmacological and social needs.
Care managers can help connect enrollees to alternative medicine benefits, like physical and occupational therapy and acupuncture.
- Palliative care that addresses whole-person needs and preferences in cancer care. Some MA plans have processes in place to identify patients with serious illness that may be appropriate for palliative care. Patients who participate may receive care both telephonically and in their home, via a nurse practitioner.
- Innovative delivery models. Several people interviewed by ATI were engaged in innovative and/or value-based care models for cancer care, such as using incentive or bonus payments to encourage providers to make appropriate cancer screening and treatment decisions.
The takeaway
The findings that MA enrollees with cancer spend less out of pocket than their peers who are enrolled in traditional Medicare are significant, particularly for people on limited incomes.
Medicare Advantage is more restrictive in terms of which providers you can see. You are often limited to seeing providers in the insurer’s network. People enrolled in traditional Medicare plans can typically see any doctors they want, as long as they accept Medicare patients.
However, MA plans may offer services that traditional Medicare doesn’t, including:
- Cancer screenings during in-home health risk assessments,
- Financial navigation,
- Care management,
- Transportation to doctor’s appointments,
- Non-medical support such as housing, food and caregiver respite,
- Transitional hospice care, and
- Hospice supplemental benefits.*
* The Hospice Value-Based Insurance Design (VBID) Model, a pilot project that sunsets in 2030, allows MA plans to take on financial responsibility for hospice services. The model helps provide beneficiaries with curative care and hospice services at the same time for a set period. In addition, plans can offer hospice supplemental benefits.
For plan year 2024, 69 MA insurers with a total of 12.4 million enrollees are participating in the VBID Model. Plans that participate will include this information in their plan summaries during the Annual Open Enrollment period and for new Medicare enrollees.