Evaluating outcomes of care and targeting quality improvement using medicare health outcomes survey data

The Medicare Health Outcomes Survey (HOS) provides a rich source of outcomes data on the Medicare Advantage (MA) program for the US Department of Health and Human Services, managed care organizations participating in Medicare, quality improvement organizations, and health services researchers working to improve quality of care for Medicare enrollees. Since 1998, the Centers for Medicare and Medicaid Services has collected longitudinal functional status information to assess the performance of Medicare managed care organizations. This introduction reviews the goals of the HOS program, how the HOS supports health care reform, and outlines recent HOS studies exploring data applications for monitoring outcomes and implementing quality improvement activities.     

Paying Medicare Advantage plans: To level or tilt the playing field

Medicare beneficiaries are eligible for health insurance through the public option of traditional Medicare (TM) or may join a private Medicare Advantage (MA) plan. Both are highly subsidized but in different ways. Medicare pays for most of costs directly in TM, and subsidizes MA plans based on a “benchmark” for each beneficiary choosing a private plan. The level of this benchmark is arguably the most important policy decision Medicare makes about the MA program. Many analysts recommend equalizing Medicare’s subsidy across the options – referred to in policy circles as a “level playing field.” This paper studies the normative question of how to set the level of the benchmark, applying the versatile model developed by Einav and Finkelstein (EF) to Medicare. The EF framework implies unequal subsidies to counteract risk selection across plan types. We also study other reasons to tilt the field: the relative efficiency of MA vs. TM, market power of MA plans, and institutional features of the way Medicare determines subsidies and premiums. After review of the empirical and policy literature, we conclude that in areas where the MA market is competitive, the benchmark should be set below average costs in TM, but in areas characterized by imperfect competition in MA, it should be raised in order to offset output (enrollment) restrictions by plans with market power. We also recommend specific modifications of Medicare rules to make demand for MA more price elastic.     

Understanding variations in Medicare Consumer Assessment of Health Care Providers and Systems scores: California as an example

Objective. To understand reasons why California has lower Consumer Assessment of Healthcare Providers and Systems (CAHPS) scores than the rest of the country, including differing patterns of CAHPS scores between Medicare Advantage (MA) and fee‐for‐service, effects of additional demographic characteristics of beneficiaries, and variation across MA plans within California. Study Design/Data Collection. Using 2008 CAHPS survey data for fee‐for‐service Medicare beneficiaries and MA members, we compared mean case mix adjusted Medicare CAHPS scores for California and the remainder of the nation. Principal Findings. California fee‐for‐service Medicare had lower scores than non‐California fee‐for‐service on 11 of 14 CAHPS measures; California MA had lower scores only for physician services measures and higher scores for other measures. Adding race/ethnicity and urbanity to risk adjustment improved California standing for all measures in both MA and fee‐for‐service. Within the MA plans, one large plan accounted for the positive performance in California MA; other California plans performed below national averages. Conclusions. This study shows that the mix of fee‐for‐service and MA enrollees, demographic characteristics of populations, and plan‐specific factors can all play a role in observed regional variations. Anticipating value‐based payments, further study of successful MA plans could generate lessons for enhancing patient experience for the Medicare population.     

How Do the Experiences of Medicare Beneficiary Subgroups Differ between Managed Care and Original Medicare?

Objective. To examine whether disparities in health care experiences of Medicare beneficiaries differ between managed care (Medicare Advantage [MA]) and traditional fee‐for‐service (FFS) Medicare. Data Sources. 132,937 MA and 201,444 FFS respondents to the 2007 Medicare Consumer Assessment of Health Care Providers and Systems (CAHPS) survey. Study Design. We defined seven subgroup characteristics: low‐income subsidy eligible, no high school degree, poor or fair self‐rated health, age 85 and older, female, Hispanic, and black. We estimated disparities in CAHPS experience of care scores between each of these groups and beneficiaries without those characteristics within MA and FFS for 11 CAHPS measures and assessed differences between MA and FFS disparities in linear models. Principal Findings. The seven subgroup characteristics had significant (p<.05) negative interactions with MA (larger disparities in MA) in 27 of 77 instances, with only four significant positive interactions. Conclusion. Managed care may provide less uniform care than FFS for patients; specifically there may be larger disparities in MA than FFS between beneficiaries who have low incomes, are less healthy, older, female, and who did not complete high school, compared with their counterparts. There may be potential for MA quality improvement targeted at the care provided to particular subgroups.     

How Successful Is Medicare Advantage?

Context

Medicare Part C, or Medicare Advantage (MA), now almost 30 years old, has generally been viewed as a policy disappointment. Enrollment has vacillated but has never come close to the penetration of managed care plans in the commercial insurance market or in Medicaid, and because of payment policy decisions and selection, the MA program is viewed as having added to cost rather than saving funds for the Medicare program. Recent changes in Medicare policy, including improved risk adjustment, however, may have changed this picture.

Methods

This article summarizes findings from our group''s work evaluating MA''s recent performance and investigating payment options for improving its performance even more. We studied the behavior of both beneficiaries and plans, as well as the effects of Medicare policy.

Findings

Beneficiaries make “mistakes” in their choice of MA plan options that can be explained by behavioral economics. Few beneficiaries make an active choice after they enroll in Medicare. The high prevalence of “zero-premium” plans signals inefficiency in plan design and in the market''s functioning. That is, Medicare premium policies interfere with economically efficient choices. The adverse selection problem, in which healthier, lower-cost beneficiaries tend to join MA, appears much diminished. The available measures, while limited, suggest that, on average, MA plans offer care of equal or higher quality and for less cost than traditional Medicare (TM). In counties, greater MA penetration appears to improve TM''s performance.

Conclusions

Medicare policies regarding lock-in provisions and risk adjustment that were adopted in the mid-2000s have mitigated the adverse selection problem previously plaguing MA. On average, MA plans appear to offer higher value than TM, and positive spillovers from MA into TM imply that reimbursement should not necessarily be neutral. Policy changes in Medicare that reform the way that beneficiaries are charged for MA plan membership are warranted to move more beneficiaries into MA.     

Serving rural Medicare risk enrollees: HMOs' decisions, experiences, and future plans.

This article identifies factors that influence health maintenance organizations' (HMOs) decisions about offering a Medicare risk product in rural areas; describes HMOs' recent experiences serving rural Medicare risk enrollees; and assesses the potential impact of Medicare program changes on the future willingness of HMOs to offer a Medicare risk product in rural areas. Data for the analysis were collected through interviews with a national sample of 27 HMOs. The results underscore the importance of adjusted average per capita cost (AAPCC) rates in HMOs' decisions to offer Medicare risk products in rural areas, but also indicate that other factors influence these decisions.     

Comparison of Health Outcomes for Male Seniors in the Veterans Health Administration and Medicare Advantage Plans

Objectives. To compare the Veterans Health Administration (VHA) with the Medicare Advantage (MA) plans with regard to health outcomes. Data Sources. The Medicare Health Outcome Survey, the 1999 Large Health Survey of Veteran Enrollees, and the Ambulatory Care Survey of Healthcare Experiences of Patients (Fiscal Years 2002 and 2003). Study Design. A retrospective study. Extraction Methods. Men 65+ receiving care in MA (N=198,421) or in VHA (N=360,316). We compared the risk‐adjusted probability of being alive with the same or better physical (PCS) and mental (MCS) health at 2‐years follow‐up. We computed hazard ratio (HR) for 2‐year mortality. Principal Findings. Veterans had a higher adjusted probability of being alive with the same or better PCS compared with MA participants (VHA 69.2 versus MA 63.6 percent, p<.001). VHA patients had a higher adjusted probability than MA patients of being alive with the same or better MCS (76.1 versus 69.6 percent, p<.001). The HRs for mortality in the MA were higher than in the VHA (HR, 1.26 [95 percent CI 1.23–1.29]). Conclusions. Our findings indicate that the VHA has better patient outcomes than the private managed care plans in Medicare. The VHA's performance offers encouragement that the public sector can both finance and provide exemplary health care.     

Web Chatter Before and After the Women's Health Initiative Results: A Content Analysis of On-line Menopause Message Boards

People aging into Medicare need to choose a health plan. Several challenges exist for consumers in choosing a Medicare health plan, including limited knowledge of Medicare, limited experience in using comparative health plan quality information, and limited experience and ability to pull together and use plan information from different sources like employers and the Medicare program. The Choose with Care System was developed to help consumers aging into Medicare make informed Medicare health plan choices. Choose with Care is an innovative decision support tool for employers to use to assist people approaching age 65 to learn about their Medicare health plan options and how to incorporate information on the quality of care and services offered by health plans into their choices. Employers are the targeted channel for distributing the Choose with Care materials because they are one of the most recognized and accessible formal intermediaries for information about health insurance. We used multiple methods to test the Choose with Care products. Product testing showed that the Choose with Care materials increase older consumers' knowledge of Medicare and how it relates to retiree health insurance and improves their comprehension and use of comparative quality information when choosing a health plan.     

The "choose with care system" - development of education materials to support informed Medicare health plan choices

People aging into Medicare need to choose a health plan. Several challenges exist for consumers in choosing a Medicare health plan, including limited knowledge of Medicare, limited experience in using comparative health plan quality information, and limited experience and ability to pull together and use plan information from different sources like employers and the Medicare program. The Choose with Care System was developed to help consumers aging into Medicare make informed Medicare health plan choices. Choose with Care is an innovative decision support tool for employers to use to assist people approaching age 65 to learn about their Medicare health plan options and how to incorporate information on the quality of care and services offered by health plans into their choices. Employers are the targeted channel for distributing the Choose with Care materials because they are one of the most recognized and accessible formal intermediaries for information about health insurance. We used multiple methods to test the Choose with Care products. Product testing showed that the Choose with Care materials increase older consumers' knowledge of Medicare and how it relates to retiree health insurance and improves their comprehension and use of comparative quality information when choosing a health plan.     

Impact of municipal health services Medicare waiver program.

A major goal of the municipal health services program (MHSP) was improvement of health services for the elderly while containing Medicare reimbursement. A Health Care Financing Administration financed Medicare waiver program provided some additional benefits to Medicare Part B enrollees who used the MHSP clinics. Disadvantaged and sicker elderly groups were underrepresented in MHSP facilities. However, even after taking these differences between MHSP and other patients into account, analyses of Medicare records showed that participants in this program had lower reimbursement for hospital inpatient, outpatient, and emergency room services. Also, participants had higher reimbursements for physicians' ambulatory and ancillary care. The net result was total Medicare reimbursements were decreased for program participants.     

Modeling the impact of Medicare Advantage payment cuts on ambulatory care sensitive and elective hospitalizations

Objective. To assess relationships between changes in Medicare Advantage (MA) payment rates and Medicare beneficiary hospitalizations and to simulate the effects of scheduled payment cuts on ambulatory care sensitive (ACS) and elective hospitalization rates. Data. State Inpatient Database discharge abstracts from Arizona, Florida, and New York merged with administrative Medicare enrollment and MA payment data. Study Design. Retrospective, fixed effect regression analysis of the relationship between MA payment rates and rates of ACS and elective hospitalizations among Medicare beneficiaries in counties with at least 10,000 Medicare beneficiaries and 3 percent MA penetration from 1999 to 2005. Principal Findings. MA payment rates were negatively related to rates of ACS admissions. Simulations suggest that payment cuts could be associated with higher rates of ACS admissions. No relationship between MA payments and rates of elective hospitalizations was found. Conclusions. Reductions in MA payment rates may result in a small increase in ACS admissions. Trends in ACS admissions among chronically ill Medicare beneficiaries should be tracked following MA payment cuts.     

Assessing Medicare beneficiaries' readiness to make informed health plan choices

The Transtheoretical Model (TTM, the "stage model") can guide development of programs to increase Medicare beneficiaries' readiness to make informed health plan choices. In this study, TTM staging algorithms were developed to assess readiness to engage in three types of informed choice: (1) learning about the Medicare program; (2) learning about Medicare health maintenance organizations (HMOs); and (3) reviewing different plan options. Stage of change based on all three algorithms is related to knowledge about the Medicare program and information-seeking. Findings provide evidence for the construct validity of the stage measures and for the applicability of the TTM to informed choice among beneficiaries.     

Issues regarding health plan payments under Medicare and recommendations for reform.

The failures of the market for current Medicare health plans include poor information and price distortions and can be attributed to government policy. Reforms that could improve its structure are annual open enrollment periods, premium rebates from health management organizations (HMOs) to members, and termination of the federal government's subsidy of Medicare supplementary insurance. However, the price for a basic Medicare benefits package would still be distorted because Medicare bases its contribution on the cost of a comparable package in the fee-for-service (FFS) sector rather than on the cost of the most efficient plan available to beneficiaries in each market area. The present Medicare HMO program almost certainly increases total Medicare costs and actually discourages HMO growth by shielding beneficiaries from the true price difference between basic benefits in the HMO and FFS sectors. Lacking payment reforms, the Medicare HMO program should be terminated.     

Effect of Medicare advantage payments on dually eligible Medicare beneficiaries

This study estimates the effect of Medicare Advantage (MA) payments and State Medicaid policies on the choice by Medicaid eligible Medicare beneficiaries to either join a MA plan, remain in the fee-for-service (FFS) and enroll in Medicaid (dually enrolled), or remain in FFS Medicare without joining Medicaid. Individual plan choice was modeled using a multinomial logit. The sample includes Medicaid-eligible Medicare beneficiaries (including specified low income Medicare beneficiaries [SLMBs] and qualified Medicare beneficiaries [QMBs]) drawn from the 2000 Medicare Current Beneficiary Survey (MCBS). We find a $10 increase in monthly MA payment reduces the probability of dual enrollment by four percentage points, and FFS Medicare enrollment by 11 percentage points.     

Monitoring Outcomes for the Medicare Advantage Program: Methods and Application of the VR-12 for Evaluation of Plans

The Veterans RAND 12-Item Health Survey (VR-12) is one of the major patient-reported outcomes for ranking the Medicare Advantage (MA) plans in the Health Outcomes Survey (HOS). Approaches for scoring physical and mental health are given using contemporary norms and regression estimators. A new metric approach for the VR-12 called the "VR-6D" is presented with case-mix adjustments for monitoring plans that combine utilities and mortality. Results show that the models for ranking health outcomes of the plans are robust and credible. Future directions include the use of utilities for evaluating and ranking of MA plans.