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Impact of continued biased disenrollment from the Medicare Advantage Program to fee-for-service.

BACKGROUND
Medicare managed care enrollees who disenroll to fee-for-service (FFS) historically have worse health and higher costs than continuing enrollees and beneficiaries remaining in FFS.


OBJECTIVE
To examine disenrollment patterns by analyzing Medicare payments following disenrollment from Medicare Advantage (MA) to FFS in 2007. Recent growth in the MA program, introduction of limits on timing of enrollment/disenrollment, and initiation of prescription drug benefits may have substantially changed the dynamics of disenrollment.


STUDY DESIGN
The study was based on MA enrollees who disenrolled to FFS in 2007 (N=248,779) and a sample of "FFS stayers" residing in the same counties as the disenrollees (N=551,616). Actual Medicare Part A and Part B payments (excluding hospice payments) in the six months following disenrollment were compared with predicted payments based on claims experience of local FFS stayers, adjusted for CMS-Hierarchical Condition Category (CMS-HCC) risk scores.


RESULTS
Disenrollees incurred $1,021 per month in Medicare payments, compared with $798 in predicted payments (ratio of actual/predicted=1.28, p < 0.001). Differences between actual and predicted payments were smaller for disenrollees of Preferred Provider Organizations and Private Fee-for-Service plans than of Health Maintenance Organizations. Analysis of 10 individual MA plans revealed variation in the degree of selective disenrollment.


CONCLUSIONS
Despite substantial changes in policies and market characteristics of the Medicare managed care program, disenrollment to FFS continues to occur disproportionately among high-cost beneficiaries, raising concerns about care experiences among sicker enrollees and increased costs to Medicare.