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Medicare Advantage (MA) enrollment increased by 22.2 million beneficiaries (337.0 percent) from 2006 through 2022, whereas traditional Medicare enrollment declined by 1.0 million (-2.9 percent) over that period. In 2022, adjusted MA penetration was 49.9 percent nationally, and 24.0 percent of Medicare beneficiaries with Parts A and B lived in a county with adjusted MA penetration equal to or exceeding 60 percent.

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One of the most controversial areas in discussions of single-payer approaches for the United States, such as "Medicare for All," concerns its implications for costs. Confusion over differences between federal and total spending and effects of lower patient cost sharing gets in the way of "apples-to-apples" comparisons. Key areas with potential to lower costs are lower administrative costs and lower provider prices. But cost reduction would likely be smaller than some envision, especially in the price area because of the need for a long process to gradually allow providers to adjust to lower prices and Americans' unique attitudes toward regulation.

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Patients treated at in-network facilities can involuntarily receive services from out-of-network providers, which may result in "surprise bills." While several studies report the surprise billing prevalence in emergency department and inpatient settings, none document the prevalence in ambulatory surgery centers (ASCs). The extent to which health plans pay a portion or all of out-of-network providers' bills in these situations is also unexplored. We analyzed 4.2 million ASC-based episodes of care in 2014-17, involving 3.3 million patients enrolled in UnitedHealth Group, Humana, and Aetna commercial plans. One in ten ASC episodes involved out-of-network ancillary providers at in-network ASC facilities. Insurers paid providers' full billed charges in 24 percent of the cases, leaving no balance to bill patients. After we accounted for insurer payment, we found that there were potential surprise bills in 8 percent of the episodes at in-network ASCs. The average balance per episode increased by 81 percent, from $819 in 2014 to $1,483 in 2017. Anesthesiologists (44 percent), certified registered nurse anesthetists (25 percent), and independent laboratories (10 percent) generated most potential surprise bills. There is a need for federal policy to expand protection from surprise bills to patients enrolled in all commercial insurance plans.

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OBJECTIVES: To measure value in the delivery of inpatient care and to quantify its variation across U.S. regions. DATA SOURCES / STUDY SETTING: A random (20%) sample of 33,713 elderly fee-for-service Medicare beneficiaries treated in 2,232 hospitals for a heart attack in 2013. STUDY DESIGN: We estimate a production function for inpatient care, defining output as stays with favorable patient outcomes in terms of survival and readmission. The regression model includes hospital inputs measured by treatment costs, as well as patient characteristics. Region-level effects in the production function are used to estimate the productivity and value of the care delivered by hospitals within regions. DATA COLLECTION / EXTRACTION METHODS: Medicare claims and enrollment files, linked to the Dartmouth Atlas of Health Care and Inpatient Prospective Payment System Impact Files. PRINCIPAL FINDINGS: Hospitals in the hospital referral region at the 90th percentile of the value distribution delivered 54% more high-quality stays than hospitals at the 10th percentile could have delivered, after adjusting for treatment costs and patient severity. CONCLUSIONS: Variation in the delivery of high-value inpatient care points to opportunities for better quality and lower costs.

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Alternative Payment Models (APMs) can address the limitations inherent in fee-for-service payment to support new approaches to health care delivery that produce greater value. But the models being tested are directly layered on top of fee-for-service architecture, specifically the Medicare Physician Fee Schedule. Shoring up that architecture to produce greater value, in combination with APMs, should be considered an integral part of the movement to value-based payment. We propose ending the split within the Centers for Medicare and Medicaid Services between the people managing the Medicare Physician Fee Schedule and those creating and testing APMs, with both groups advised by a revamped Physician-Focused Payment Model Technical Advisory Committee that covers both dimensions of creating greater value.

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Importance: Nearly one-third of Medicare beneficiaries are enrolled in a Medicare Advantage (MA) plan, yet little is known about the prices that MA plans pay for physician services. Medicare Advantage insurers typically also sell commercial plans, and the extent to which MA physician reimbursement reflects traditional Medicare (TM) rates vs negotiated commercial prices is unclear. Objective: To compare prices paid for physician and other health care services in MA, traditional Medicare, and commercial plans. Design, Setting, and Participants: Retrospective analysis of claims data evaluating MA prices paid to physicians and for laboratory services and durable medical equipment between 2007 and 2012 in 348 US core-based statistical areas. The study population included all MA and commercial enrollees with a large national health insurer operating in both markets, as well as a 20% sample of TM beneficiaries. Exposures: Enrollment in an MA plan. Main Outcomes and Measures: Mean reimbursement paid to physicians, laboratories, and durable medical equipment suppliers for MA and commercial enrollees relative to TM rates for 11 Healthcare Common Procedure Coding Systems (HCPCS) codes spanning 7 sites of care. Results: The sample consisted of 144 million claims. Physician reimbursement in MA was more strongly tied to TM rates than commercial prices, although MA plans tended to pay physicians less than TM. For a mid-level office visit with an established patient (Current Procedural Terminology [CPT] code 99213), the mean MA price was 96.9% (95% CI, 96.7%-97.2%) of TM. Across the common physician services we evaluated, mean MA reimbursement ranged from 91.3% of TM for cataract removal in an ambulatory surgery center (CPT 66984; 95% CI, 90.7%-91.9%) to 102.3% of TM for complex evaluation and management of a patient in the emergency department (CPT 99285; 95% CI, 102.1%-102.6%). However, for laboratory services and durable medical equipment, where commercial prices are lower than TM rates, MA plans take advantage of these lower commercial prices, ranging from 67.4% for a walker (HCPCS code E0143; 95% CI, 66.3%-68.5%) to 75.8% for a complete blood cell count (CPT 85025; 95% CI, 75.0%-76.6%). Conclusions and Relevance: Traditional Medicare's administratively set rates act as a strong anchor for physician reimbursement in the MA market, although MA plans succeed in negotiating lower prices for other health care services for which TM overpays. Reforms that transition the Medicare program toward some premium support models could substantially affect how physicians and other clinicians are paid.

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