Lessons in Medicare Advantage innovation

Attendees at the AHIP Institute in Seattle got a "fast and furious crash course" on innovating Medicare Advantage benefit design. They learned that insurers have to be creative with meeting the needs of MA beneficiaries to drive member engagement.

The Centers for Medicare and Medicaid Services continues to expect benefit uniformity, but that won't work with an age span of 50 years in the senior market, Stacia Cohen, director of program management of Medicare and Medicaid at Blue Cross and Blue Shield of Minnesota, said during her presentation.

For instance, the graying of rural Minnesota is happening faster than in the metro areas, and that growing rural footprint creates challenges to implementing tiered networks and other benefit designs that can drive members to specific providers.

Insurers with MA plan offerings will find there's more work to be done around engaging members than providers, said Mike Funk, vice president of the Provider Development Center of Excellence at Louisville-based Humana. He recommended having more flexible benefits and copays that allow members to pick primary care providers, as well as tailoring benefit designs around specific populations, such as diabetics.

Both Cohen and Funk have found success with using benefit design to motivate members to participate in wellness behaviors. While there's no secret sauce to improving member participation, the provider is powerful, Funk told the audience. He cited Humana research that found members don't get preventive screenings unless told to by their providers. Insurers also need to make sure members are aware they have access to certain services without expense, such as Humana's free diabetic eye exams.

Cohen agreed that the provider has to drive efforts, but noted that member participation in value-added benefits like wellness programs is about making it easy. If they design the benefits as social activities, people will engage.

At BCBSMN, the wellness benefit is mainly a retention play. About 40 percent of MA beneficiaries say they signed up because of the fitness benefit, although only 10 percent actually use it, Cohen said. Now, the focus needs to be on how to get the 90 percent who don't use it to do so.

Despite member interest around value-added benefits, insurers need to be cautious as MA rates fall along with available dollars to implement those programs. "Once you give it, it's very difficult to take it away," Cohen said.