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Significant differences uncovered between MA, FFS enrollees

For health plans, authors expect the study can provide a better understanding of the core customer segments of MA.

Jeff Lagasse, Associate Editor

Photo: Marko Geber/Getty Images

Medicare Advantage and fee-for-service Medicare enrollees have some significant differences in the year prior to enrollment in Medicare at age 65, including differing demographic and socioeconomic characteristics – traits that should be afforded more attention by MA payers, according to a new white paper by Harvard Medical School and analytics outfit Inovalon.

Demographically, MA enrollees differ meaningfully from FFS enrollees. MA has a slightly higher proportion of males. Compared to FFS, those in MA are also twice as likely to be non-white, and much more likely to be Black, Hispanic or Asian.

MA enrollees are more likely to live in the Northeast and Midwest, while FFS enrollees are more likely to live in the South or West census regions. MA enrollees are also more likely to live in an urban area, slightly more likely to live in a suburban area and much less likely to live in a rural area.

Perhaps the starkest difference between the two groups is in the types of commercial plans in which they were enrolled, pre-65: MA enrollees are more than 50% more likely than those in FFS to have been enrolled in an HMO plan. 

"Given that MA plans tend to have relatively more restrictive care management policies, it makes sense that individuals who have previous exposure to care management would be more comfortable with that type of coverage under MA," according to the white paper.


The analysis also showed substantial differences in the health-relevant socioeconomic characteristics of MA and FFS enrollees. The average income of an FFS enrollee is $85,085, compared to $76,720 for an MA enrollee. This gap arises from the relative lack of MA enrollees in the most affluent segments: While 35.5% of FFS enrollees have incomes above $100,000, this is true for only 23.8% of MA enrollees. The average MA enrollee has a net worth that is only 74.2% of that of the average FFS enrollee.

MA enrollees are more likely to face many other socioeconomic disadvantages relative to their FFS enrollee counterparts. Those in their near neighborhood are more likely to have only a high school education or less, and are slightly more likely to live in a high unemployment area, though the latter comparison is not statistically significant. 

They are less likely to own their home, to be married and to own a vehicle, and more likely to have difficulty speaking English. Additionally, based on two aggregate measures of social risk – the Area Deprivation Index and the Socioeconomic Status (SES) index – MA enrollees are more socioeconomically disadvantaged than those in FFS. 

The paper also compared MA and FFS enrollees in terms of their baseline health status. Since MA directly affects healthcare utilization, measuring health status for the already-enrolled beneficiaries runs the risk of confusing their underlying health status with the effect of MA enrollment itself. The linkage to pre-65 commercial claims data solves this problem, the authors said, by measuring health status at age 64, before individuals enroll in Medicare.

The results show that immediately prior to enrollment, those going into MA are modestly less sick than their FFS enrollee counterparts, having about 10% lower Hierarchical condition category (HCC) risk scores and Charlson Comorbidity Index scores.

MA and FFS enrollees have similar prevalence of the top chronic conditions among Medicare beneficiaries including hypertension and hyperlipidemia. FFS enrollees are more likely to have certain conditions, including cancer, joint issues and heart issues. On the other hand, MA enrollees are more likely to have diabetes.


For health plans, authors expect the study can provide a better understanding of the core customer segments of MA, and which beneficiaries are most likely to enroll in MA vs. FFS. 

"This information can help health plans better tailor and target their products to the core MA beneficiary base to enhance recruitment efforts," the authors wrote.

Likewise, they said, it can help MA plans better understand the types of beneficiaries that are less drawn to MA and help them tailor new offerings that better appeal to non-core groups. Plans can also use this information to better prepare for new members joining at 65 and their expected resource needs, based on those populations' pre-65 chronic condition profiles, healthcare utilization and costs.

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