Scholars Flag 5% Higher Prices at Hospital-Owned Medicare Advantage Plans Covering 35 Million
Updated
Updated · Yahoo! Voices · Aug 18
Scholars Flag 5% Higher Prices at Hospital-Owned Medicare Advantage Plans Covering 35 Million
3 articles · Updated · Yahoo! Voices · Aug 18
Summary
Nearly 1 in 6 Medicare Advantage enrollees are in hospital-owned plans, and researchers found affiliated plans pay the same hospital about 5% more on average than unaffiliated plans.
The concern is that integrated hospital-insurer groups can boost taxpayer-funded payments by recording more diagnoses for risk adjustment or by inflating internal prices to satisfy Medicare Advantage’s 85% medical-loss-ratio rule.
Researchers also found competition risks: 10% to 20% of hospitals with their own plans charged rival Medicare Advantage insurers higher prices, while 66% to 73% charged similar prices.
The model is expanding—2,190 hospitals are owned by companies that also own a Medicare Advantage plan—even as studies suggest these plans can reduce prior authorizations and improve care coordination, quality and some outcomes.
With Medicare Advantage now covering just over 35 million people, scholars said the trade-off between better integration and possible anti-competitive or costly behavior still needs more study.