Better Medicare plans are rare in poor areas

Looking for a Medicare Advantage plan with a five-star quality rating? You’re less likely to find one if you live in a county with higher poverty and unemployment, according to a new study. Published in Opening of the JAMA network.

These geographic disparities could contribute to unequal health outcomes and limit access to federal funds to areas that need them most, researchers say.

“This means that Medicare beneficiaries living in more socially disadvantaged counties have fewer opportunities to choose highly rated Medicare Advantage plans that might provide high-quality care,” said Avni Gupta, a health policy researcher who recently earned her doctorate in health policy and management from the NYU School of Global Public Health and now works at the Commonwealth Fund.

More than half of Medicare beneficiaries—nearly 31 million people—enroll in Medicare Advantage plans instead of choosing traditional Medicare. Medicare Advantage plans, also known as “Part C,” are offered by private health insurance companies that contract with Medicare and typically bundle hospital care, outpatient care, and prescription drugs.

To help consumers compare the quality of Medicare Advantage plans, the Centers for Medicare & Medicaid Services (CMS) uses a five-star rating system, calculating scores based on nearly 40 indicators.

“Star ratings are intended to capture the performance of Medicare Advantage plans over the past several years, with higher ratings demonstrating higher quality care in areas such as chronic care management, screenings, immunizations and other preventive services, timely appointments, care coordination, customer service and call handling,” said Gupta, the study’s lead author.

Additionally, star ratings determine the bonuses and rebates insurance companies receive from CMS; larger payments to higher-rated plans can translate into better additional benefits for beneficiaries.

As enrollment in Medical Advantage plans increases each year (and low-income black and Hispanic adults in particular have been enrolling at higher rates in recent years), Gupta and his colleagues sought to understand whether quality scores vary by location.

Using the 2023 Medicare Advantage star ratings, ranging from the highest rating (4.5 or 5 stars) to the lowest rating (less than 3.5 stars), the researchers mapped plan availability in 3,075 U.S. counties. They also looked at county-level characteristics using the Centers for Disease Control and Prevention’s Social Vulnerability Index, a calculation of 16 social determinants of health, including poverty, unemployment, education, disability, race and ethnicity, English proficiency, housing, and access to transportation.

They found that Medicare Advantage plans in the most disadvantaged counties were less likely to have high ratings (4.5 stars or higher) and more likely to have low ratings (3.5 stars or lower).

“Our findings suggest that beneficiaries who could benefit most from supplemental benefits may only choose plans that are less likely to have the financial resources to provide those benefits, given that lower star ratings translate into lower bonuses and rebates for insurance plans,” Gupta added. “Such a pattern of county-level star ratings and social vulnerability could exacerbate inequalities in health care access, experience, and outcomes.”

The researchers note that Medicare policies that factor local vulnerability into the star rating system or that incentivize plans that serve those areas could help promote equity.

In addition to Gupta, the study’s authors include José Pagán and Diana Silver of the NYU School of Global Public Health, Sherry Glied of New York University’s Robert F. Wagner Graduate School of Public Service, and David Meyers of Brown University School of Public Health.