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The effects of plan payment rates on the market for Medicare Advantage Dual‐Eligible Special Needs Plans
Author(s) -
McGarry Brian E.,
Layton Timothy J.,
Grabowski David C.
Publication year - 2019
Publication title -
health services research
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.706
H-Index - 121
eISSN - 1475-6773
pISSN - 0017-9124
DOI - 10.1111/1475-6773.13170
Subject(s) - benchmark (surveying) , payment , actuarial science , quality (philosophy) , snp , medicare advantage , business , medicine , computer science , economics , single nucleotide polymorphism , health care , finance , biology , genetics , geography , philosophy , geodesy , epistemology , economic growth , genotype , gene
Objective To determine the effect of higher potential benchmark payment rates on the market for Medicare Advantage ( MA ) Dual‐Eligible Special Needs Plans (D‐ SNP s). Data Sources/Study Setting Publicly available county‐level data from 2009 to 2015 regarding the number of D‐ SNP s operating within the county, the enrollment in and five‐star quality of score of these plans, and the benchmark amounts used to determine capitated plan payments. Study Design This study exploits the introduction of quality bonus payments to the MA program in 2012, and exogenous geographic variation in the potential size of these bonuses to estimate the effect of benchmark payment increases on the availability, quality, and take‐up of D‐ SNP s. We use a difference‐in‐difference estimation approach to compare changes in the market for D‐ SNP s in counties eligible for a double bonus to those that are not. Principal Findings The doubling of bonuses was associated with a relative 29 percent increase in the number of D‐ SNP s offered ( P = 0.021) and 0.1‐star increase in the average quality of available D‐ SNP s ( P = 0.034). No relative increase in overall D‐ SNP enrollment was detected. Conclusions These findings indicate that larger benchmark payment amounts may influence insurers’ decisions of whether to participate in the D‐ SNP market but not dual‐eligibles' decision of whether to enroll in these plans. Future research is needed to inform discussions about whether D‐ SNP s are a viable mechanism for integrating benefits for dual eligibles and the degree to which Medicare policies should support their continued growth.