Medicare Advantage Enrollees More Likely To Enter Lower-Quality Nursing Homes Compared To Fee-For-Service Enrollees

Abstract

Unlike fee-for-service (FFS) Medicare, most Medicare Advantage (MA) plans have a preferred network of care providers that serve most of a plan's enrollees. Little is known about how the quality of care MA enrollees receive differs from that of FFS Medicare enrollees. This article evaluates the differences in the quality of skilled nursing facilities (SNFs) that Medicare Advantage and FFS beneficiaries entered in the period 2012-14. After we controlled for patients' clinical, demographic, and residential neighborhood effects, we found that FFS Medicare patients have substantially higher probabilities of entering higher-quality SNFs (those rated four or five stars by Nursing Home Compare) and those with lower readmission rates, compared to MA enrollees. The difference between MA and FFS Medicare SNF selections was less for enrollees in higher-quality MA plans than those in lower-quality plans, but Medicare Advantage still guided patients to lower-quality facilities.

Keywords: Insurance; Long-Term Care; Managed Care - Medicare < Managed Care; Medicare; Quality Of Care.

Exhibit 2. Percentages of fee-for-service (FFS) Medicare and Medicare Advantage (MA) patients who entered a higher-quality skilled nursing facility (SNF), by percentage of MA penetration in the patient’s residential ZIP code

SOURCE Authors’ analysis of data for 2012–14 from the Minimum Data Set, Healthcare Effectiveness Data and Information Set, and Nursing Home Compare. NOTES Higher-quality SNFs are rated four or five stars by Nursing Home Compare. “MA low quality” and “MA high quality” are explained in the notes to exhibit 1. Shaded areas represent 95% confidence intervals.