Do Medicare Advantage plans pay providers different rates than traditional Medicare?

Austin Frakt

June 18, 2015

Several source suggest they don’t.

Berenson, Ginsburg, Christianson, and Yee:

With few exceptions, we learned that Medicare Advantage plans pay provider rates at or close to fee-for-service Medicare rates. Similarly, Medicaid managed care plan payments are close to the relatively low Medicaid fee-for-service rates.

Congressional Budget Office:

[T]he rates paid for Medicare Advantage enrollees are similar to or slightly above those that Medicare pays for FFS patients’ care.

Medicare Payment Advisory Commission:

MA plan hospital prices are not tied to prices in the non-Medicare market, which is consistent with what we have heard from plans and other market participants. Non-Medicare physician payment rates also appear to have at most a modest relationship to MA bids, suggesting that physician payment rates may be partly anchored to FFS prices.

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Austin Frakt

Austin Frakt, PhD, is co-Editor-in-Chief of The Incidental Economist. His day job is Associate Director of the Partnered Evidence-based Policy Resource Center at the Boston VA Healthcare System, U.S. Department of Veterans Affairs. He is also a Professor with the Department of Health Law, Policy and Management at the Boston University’s School of Public Health, a Principal Research Scientist with the Department of Health Policy and Management at the Harvard T.H. Chan School of Public Health, and Editor-in-Chief of the journal Health Services Research.

Do Medicare Advantage plans pay providers different rates than traditional Medicare?

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Austin Frakt

The Incidental Economist

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