Low-Income Beneficiaries Depend Largely on Medicare Advantage

February 17, 2016

Additional cuts to Medicare Advantage plans would unduly affect the more than one-third of beneficiaries in the low-income bracket, according to a report from America's Health Insurance Plans.

Medicare Advantage is crucially important to beneficiaries with low income, according to a new report from America’s Health Insurance Plans (AHIP). If additional cuts were to be introduced to the program, more than one-third of Medicare Advantage beneficiaries in the low-income bracket would be unduly affected.

The report points out that more than 37% of Medicare Advantage beneficiaries fall in the low-income category with incomes below $20,000. Across the country, 17 million seniors—roughly 30% of all Medicare enrollees in 2015—have chosen Medicare Advantage for the higher quality care and additional benefits these plans provide.

Findings of the Report

Unlike traditional fee-for-service Medicare, Medicare Advantage offers far-reaching disease management programs and care coordination services to help millions of seniors deal with their health conditions. These programs are critically important for low-income beneficiaries, as they are more likely to have multiple chronic diseases.

The report used data from the 2013 Medicare Current Beneficiary Survey maintained by CMS. Non-institutionalized beneficiaries eligible for Medicare as of January 1, 2013, were interviewed from all 50 states, the District of Columbia, and Puerto Rico. AHIP found that:

  • Out of the total Medicare Advantage beneficiaries, approximately 14% of enrollees were Hispanic and 11% were African American.

  • The gender distribution was an important observation, also. Out of the total Medicare Advantage beneficiaries, more than half (55%) of the seniors were women.

  • Of the total Medicare Advantage enrollees, 41% were older than 75 years of age.

  • The share of diverse population enrolled in Medicare Advantage was 29% compared to 23% for Medicare fee-for-services and 25% for traditional Medicare services.

Conclusion

Medicare Advantage remains critically important for beneficiaries of diverse origins as well as the low-income levels. Research has repeatedly shown that these Medicare Advantage programs have significantly improved health outcomes for seniors. If the payment policies were to be changed, it would further impact the coverage and benefit options for such beneficiaries.

"For our nation's seniors and the most vulnerable citizens, Medicare Advantage's comprehensive, coordinated approach to care delivery improves beneficiaries' health and quality of life," AHIP President and CEO Marilyn Tavenner said.