A recent Wall Street Journal story presents a deeply flawed viewpoint on coverage changes for Medicare beneficiaries in the last year of their lives.
Here are the facts:
- Robust coverage and satisfaction: Medicare Advantage is a vital coverage option chosen by more than 33 million seniors and individuals with disabilities because it provides comprehensive support services for managing chronic conditions and financial protections that limit enrollees’ out-of-pocket costs.
- Despite the story’s generalizations, Medicare coverage changes in the last year of life are very limited.
- The overwhelming majority of Medicare Advantage enrollees – approximately 95% – chose to keep their Medicare Advantage coverage and benefits as their health status changed in their last year of life, a point the Wall Street Journal concedes in its story. Medicare Advantage enrollees also consistently report high levels of satisfaction with their coverage.
- Since the Medicare statute prohibits hospice coverage by Medicare Advantage plans, a very small percentage of seniors and Medicare beneficiaries may transition to fee-for-service Medicare when they are considering hospice. AHIP and its members support ensuring the availability of comprehensive coverage and care throughout a beneficiary’s full life.
- Notably, the story also ignores the federal rules that took effect in 2024 which impose new restrictions on the use of prior authorization in Medicare Advantage, including for coverage in nursing homes and rehab facilities after beneficiaries leave the hospital.
- Benefits for end-of-life care: Medicare Advantage plans offer valuable benefits that fee-for-service Medicare does not cover that can be vital for enrollees in the last year of life, including home-based palliative care, in-home support services, and support for caregivers of enrollees. Further, the financial protections that Medicare Advantage plans provide are particularly important in the later stages of life when health spending can be extremely high.
- Seniors and individuals with disabilities enrolled in fee-for-service Medicare don’t have limits on out-of-pocket costs for medical services and care. In contrast, once Medicare Advantage beneficiaries exceed their out-of-pocket limit, their plan covers 100% of the cost of Medicare-covered services.
- In fact, a 2024 analysis by ATI Advisory found that Medicare Advantage delivered average savings of more than $2,500 for beneficiaries.
- Flexibility and choice: The Medicare program offers seniors the flexibility to choose the right coverage for them as their needs evolve. Not surprisingly, a Medicare Advantage plan that meets a patient’s needs at one point in life may not be the best fit at a different time.
- A beneficiary may move closer to family and out of the existing plan’s service area or health facility. A beneficiary’s provider may recommend a new set of doctors, hospitals or specialists outside of their existing plan network.
- Allowing Medicare beneficiaries to change their coverage when life events occur is reflective of the program working as intended. Medicare Advantage beneficiaries also have the option of switching their plan to another Medicare Advantage coverage option in the first quarter of the year after initial enrollment if they so choose.
- Spending in fee-for-service Medicare v. Medicare Advantage: Comparing fee-for-service Medicare spending and Medicare Advantage costs for people in the last year of life is misleading and ignores key program differences.
- The Medicare Advantage payment structure is designed to encourage more high-value care.
- Medicare Advantage plans are paid a capitated monthly amount based on the expected health care costs for an individual.
- As a result, alleged spending calculations are likely overstated and ignore the policy concerns that may be raised by fee-for-service spending.
For millions of seniors and individuals with disabilities, Medicare Advantage continues to be a lifeline at their most critical health moments. Policymakers should continue to strengthen and protect this critical part of the Medicare program for those who depend on it.