Price not a good indicator of Medicare Advantage plan’s quality

New study shows weak link between premiums, patient satisfaction and level of care

When it comes to Medicare Advantage (MA) plans, money doesn’t always buy happiness.

Nearly half of Medicare beneficiaries now get their coverage through MA plans, and most say they choose which plan to enroll in based on premiums and out-of-pocket expenses without considering care quality. But a new study finds that quality of care and overall patient experience are only slightly among higher-premium plans, and good care and high levels of patient satisfaction are available at every price level.

The study’s authors surveyed 169,000 beneficiaries enrolled in about 700 MA plans in 2016 and 2017 regarding their quality of care and experience. The plans were grouped into four categories based on their monthly premiums, with the lowest being $0 to $60 and the highest $120 and above. The authors used measures from the Healthcare Effectiveness Data and Information Set to evaluate quality, patient experience measures from Consumer Assessment of Healthcare Providers and Systems, and CMS administrative data on MA plan features and premiums.

The results showed that enrollees in the two highest categories of premium plans ($60-$120 and $120 and above) reported care quality and patient experience that were slightly higher on most measures than those in plans with zero or low premiums. But the differences were substantially smaller than those among plans in the same premium category.

“The highly variable quality within premium categories…indicates that premium is at best a weak proxy for plan quality,” the authors say. “Making plan quality information more accessible and salient to consumers remains key to reducing cost while improving quality.”

“Paying higher premiums is not necessary to receive high quality care from a Medicare Advantage plan,” lead author Amelia M. Haviland, Ph.D., professor of statistics and public policy at Carnegie Mellon University and adjunct statistician at the think tank RAND Corporation, said in an accompanying news release from RAND.

“Seniors should look at metrics other than premium costs alone when looking for a Medicare Advantage Plan that offers high-quality care, including direct measures of quality such as Star Ratings.”

The study, “Association of Medicare Advantage Premiums With Measures of Quality and Patient Experience,” was published online August 26 in JAMA Health Forum.