Almost 21% of all Medicare Advantage (MA) enrollees were offered at least one supplemental benefit in 2019, according to a new study.
Of the available benefits—made possible last year by a Centers for Medicare & Medicaid Services (CMS) rule—the highest adoption was for caregiver support plans at 17.7% of all MA enrollees, followed by in-home support, 2.2%. Just two plans in 2019 offered adult day care as a supplement.
"We were surprised to see that while 12.7% of plans offered a newly allowable supplemental benefit, the majority of these plans only offered caregiver supports," Kali Thomas, associate professor of health services, policy and practice at Brown University's School of Public Health, told FierceHealthcare. "There was limited adoption of other benefits, such as in-home supports and adult day care, that directly focus on the social needs of members. This represents a noteworthy shift in MA benefit design as it not only addresses a 'non-medical need,' but it also extends it to a person who may not be a covered member."
Since April of 2018, new rules from CMS allow for MA plans to expand the types of supplemental benefits that can be offered to enrollees. Therefore, research published in JAMA Network letters analyzed the early adoption of these supplemental benefits within the categories of adult day care, home-based palliative care, in-home support, caregiver supports, memory fitness and non-opioid pain management benefits. Researchers compared side-by-side MA plans with new benefits and plans that did not offer new benefits.
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The study looked at 592 health insurance plans across 85 contracts. In total, 22 million people enrolled for MA in 2019, which is equal to 34% of all Medicare beneficiaries.
When comparing health maintenance organizations (HMOs) versus preferred provider organizations (PPOs), about 25% of HMOs adopted new benefits in 2019, compared with 14% of PPOs. And in comparing older plans versus newer MA plans, 23% of enrollees that were in contracts formed before 2006 were offered new benefits, versus 13.4% in contracts formed after 2014.
There was also a significant difference in offerings between for-profit and nonprofit health plans. New benefits were offered to 27% of enrollees in for-profit plans, and only 3.1% of enrollees in nonprofit plans were offered new benefits. Further, supplemental benefit lines were often drawn geographically, as new benefits were offered to more than 35% of enrollees in the Mountain Census Division and to just 13.6% of enrollees in the East North Central Division.
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Overall, adoption has been slow in the first year of MA benefit expansion, with only 20.8% of enrollees offered any supplemental benefits. The study suggests that limited adoption may be attributed to a lack of evidence to support that added benefits will yield profits. Another reason for the slow uptake could be the timetable—the new rules were announced in April and open enrollment began in June.
Another key factor in the decision to offer supplemental benefits could be linked to age and size, with older or larger contracts more willing to take a risk on the new offerings due to more resources.
Moving forward, supplemental benefits will be further expanded in 2020, as CMS included in its annual rate announcement the option for value-based insurance models in MA for chronically ill enrollees.
"As a result of the passage of the Bipartisan Budget Act of 2018, MA plans have even greater flexibility in offering benefits to address chronically ill members’ social needs in 2020," Thomas said. "While we will not know what plans will cover in 2020 until later this year, our results suggest that adoption of new supplemental benefits may vary by plan characteristics."