Primary Care Physicians In Medicare Advantage Were Less Costly, Provided Similar Quality Versus Regional Average

Eran Politzer, Timothy S. Anderson, John Z. Ayanian, Vilsa Curto, John A. Graves, Laura A. Hatfield, Jeffrey Souza, Alan M. Zaslavsky, Bruce E. Landon

Research output: Contribution to journalArticlepeer-review

Abstract

The use of many services is lower in Medicare Advantage (MA) compared with traditional Medicare, generating cost savings for insurers, whereas the quality of ambulatory services is higher. This study examined the role of selective contracting with providers in achieving these outcomes, focusing on primary care physicians. Assessing primary care physician costliness based on the gap between observed and predicted costs for their traditional Medicare patients, we found that the average primary care physician in MA networks was $433 less costly per patient (2.9 percent of baseline) compared with the regional mean, with less costly primary care physicians included in more networks than more costly ones. Favorable selection of patients by MA primary care physicians contributed partially to this result. The quality measures of MA primary care physicians were similar to the regional mean. In contrast, primary care physicians excluded from all MA networks were $1,617 (13.8 percent) costlier than the regional mean, with lower quality. Primary care physicians in narrow networks were $212 (1.4 percent) less costly than those in wide networks, but their quality was slightly lower. These findings highlight the potential role of selective contracting in reducing costs in the MA program.

Original languageAmerican English
Pages (from-to)372-380
Number of pages9
JournalHealth Affairs
Volume43
Issue number3
DOIs
StatePublished - 2024

Bibliographical note

Publisher Copyright:
© 2024, Project HOPE. All rights reserved.

Keywords

  • COSTS AND SPENDING
  • HOSPITAL REFERRAL REGIONS
  • MEDICARE ADVANTAGE
  • PRIMARY CARE
  • QUALITY MEASUREMENT
  • QUALITY OF CARE
  • TRADITIONAL MEDICARE

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