Tuesday, October 9, 2018

Medicare Advantage Plans Shifting Financial Risk to Drs?

According to a recent Kaiser Health News article,  Medicare Advantage Plans Shift Their Financial Risk To Doctors,   Medicare Advantage (MA) Plans pay medical groups "a fixed monthly payment ... to cover virtually all of their members’ health needs, including drugs and physician, hospital, mental health and rehabilitation services."

This model — known as “full-risk” or “global risk” — is increasingly used by Medicare plans such as Humana and UnitedHealthcare to shift their financial exposure from costly patients to WellMed and other physician-management companies. It gives the doctors’ groups more money upfront and control over patient care. ... As a result, they go to extraordinary lengths to keep their members healthy and avoid expensive hospital stays.

As the article notes, there is a financial incentive for the health care providers with this model, and experts disagree whether it results in better care or less care for patients. As the article notes, beneficiaries choose an MA plan and pick doctors within the plan, often without knowing if the MA plan has delegated oversight of the beneficiaries' health to these physician groups.  And the impact of this full-risk approach should not be understated:

Nearly one-third of the 57 million Medicare beneficiaries are covered by private Medicare Advantage plans — an alternative to government-run Medicare — and federal officials have estimated that the proportion will rise to 41 percent over the next decade. The government pays these plans to provide medical services to their members.

The “global risk” system has been used in South Florida and Southern California since the late 1990s and nearly half of Medicare Advantage members in those regions get care in the model. The use has spread further in the past two years as large physician companies have become more common, and about 10 percent of Medicare Advantage plan members across the nation are in them now, health consultants say.

... 

Under the “global risk” arrangements, the health plans give the physician companies the bulk of their Medicare funding when they take on the mantle of being financially responsible for all patient care.

 Keep an eye on this -- it's important.

https://lawprofessors.typepad.com/elder_law/2018/10/medicare-advantage-plans-shifting-financial-risk-to-drs.html

Consumer Information, Current Affairs, Federal Statutes/Regulations, Health Care/Long Term Care, Medicare | Permalink

Comments

If this global system has been in effect over a large consumer base since the 1990's, I'm wondering if any research has been done to assess the impact on population health in those areas compared with similar sized populations under different payment models.

Posted by: Sharon Willen | Oct 10, 2018 7:34:35 AM

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