Healthcare Delivery under Alternative Medicare Plans: Insights from Patient Records and Physician Interviews

This study investigates differences in annual healthcare services usage by enrollees in various Medicare and Medicare Advantage plans with consideration of the major factors that should account for such differences. Using the Centers for Medicare and Medicaid Services’ detailed patient-encounter and diagnostic records for a random sample of one million Missouri Medicare beneficiaries, we compared healthcare services received by individuals insured under different Medicare and Medicare Advantage plans. With complementary information about patient demographics and access to healthcare resources, we examine the factors affecting healthcare services received. The results show that plan and provider choices relate to significant utilization variances even after considering enrollee attributes, access to medical providers, and terms of their insurance plans. There also is evidence that agency relationships between payers and risk-sharing providers may be a contributing factor to those variances. These results merit careful consideration by all parties involved in healthcare financing and delivery as they develop health policy, negotiate insurance arrangements, plan facilities, install equipment, and staff for services. Further research to identify successful and replicable payer-provider arrangements offers opportunities for significant Medicare program savings.