Medicare Advantage Plans: Who Benefits When the Government Pays More?

KNOWLEDGE AT WHARTON ARCHIVES: When the U.S. government pays more for medical services — as it does for Medicare Advantage — does the quality of those services improve? Not much, says Mark Duggan, a Wharton business economics and public policy professor. That was a key finding that he and co-authors Amanda Starc, a Wharton health care management professor, and Wharton Ph.D. student Boris V. Vabson came to in their recent research paper, “Who Benefits When the Government Pays More? Pass-through in the Medicare Advantage Program.”

In this interview, Duggan explains the study’s findings and some of the policy implications. He notes the increase in competition generated by higher Medicare Advantage payments “doesn’t seem to translate into better benefits for consumers.” The study could have implications for Medicaid, managed care and other government health care spending, Duggan says. It shows there may be many opportunities to cut programs, with minimal adverse impact on consumers, and then use the money saved where it may provide more efficient benefits.

More on this interview: https://knowledge.wharton.upenn.edu/article/medicare-advantage-offer-much-advantage/

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