Study: Medicare Advantage double bonuses did not improve quality ratings

Paying some Medicare Advantage plans double bonuses under a pay-for-performance program did not result in higher quality ratings, according to a new study.

"At great expense to Medicare, double bonuses in the Medicare Advantage Quality Bonus Payment Demonstration were not associated with improved quality but were associated with more plan offerings," concluded researchers at the University of Michigan.

The double bonuses, part of a pay-for-performance demonstration launched in 2012 by the Centers for Medicare & Medicaid Services, increased payments by $3.43 billion over the first three years of the project, according to the study, which was published in the December issue of Health Services Research.

The extra investment of more than $1 billion per year did not improve quality ratings overall but did result in a nearly 6 percent increase in the number of plans offered, the study found.

The bonus program targeted Medicare Advantage plans paying out extra money based on healthcare plans' quality scores. Plans received one to five quality stars on more than 30 measures across five domains: preventive care and staying healthy, management of chronic conditions, health plan responsiveness and care, customer satisfaction, and telephone customer service.

Counties that were part of the demonstration were eligible for double bonuses at rates of 3 to 10 percent of plan payments versus the usual 1 to 2 percent. Lead study author Andrew Ryan, an associate professor at the University of Michigan's School of Public Health, said in the study announcement that early research seems to show that pay-for-performance programs are not transforming healthcare in the way people hoped.

While the extra money did not translate to better quality, Medicare Advantage members are generally more satisfied with their care than those enrolled in commercial plans, according to previous research. Enrollment in the plans keeps climbing and is projected to increase to an all-time high next year.

To learn more:
- read the study announcement
- check out the study


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