Adjusted Mortality Rates Are Lower For Medicare Advantage Than Traditional Medicare, But The Rates Converge Over Time

Overall mortality rates, adjusted for age, sex, and Medicaid status, in Medicare Advantage have been below those in traditional Medicare for many years. Much attention has been paid to the resulting issue of favorable selection in Medicare Advantage. The common study design used to estimate causal e...

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Bibliographic Details
Published in:Health Affairs 2019-04, Vol.38 (4), p.554-560
Main Authors: Newhouse, Joseph P., Price, Mary, McWilliams, J. Michael, Hsu, John, Souza, Jeffrey, Landon, Bruce E.
Format: Article
Language:English
Subjects:
Advantages
Age
Beneficiaries
Budgets
Convergence
Enrollments
Government programs
Health maintenance organizations
Health risks
HMOs
Internet
Investigations
Medicaid
Medicare
Mortality
Mortality rates
Mortality risk
Reimbursement
Studies
Survival analysis
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Summary:Overall mortality rates, adjusted for age, sex, and Medicaid status, in Medicare Advantage have been below those in traditional Medicare for many years. Much attention has been paid to the resulting issue of favorable selection in Medicare Advantage. The common study design used to estimate causal effects of Medicare Advantage on utilization and outcomes compares new Medicare Advantage beneficiaries immediately before and after enrollment in Medicare Advantage with beneficiaries who choose to remain in traditional Medicare. What has not been studied is the mortality experience of a cohort that initially chooses enrollment in Medicare Advantage versus one that chooses traditional Medicare. In this study we found that the adjusted mortality rate of a cohort newly enrolled in Medicare Advantage was initially well below that of a cohort newly enrolled in traditional Medicare, but the difference markedly decreased after five years. As a result, the common study design is flawed because it assumes that any initial difference in mortality risk remains constant after enrollment in Medicare Advantage. In other words, those initially choosing Medicare Advantage become sicker relative to traditional Medicare beneficiaries over five years. Whether the mortality rates would fully converge if a period longer than five years were observed is a topic for further research.
ISSN:0278-2715
1544-5208
DOI:10.1377/hlthaff.2018.05390