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Missing in Medicare Advantage: Meaningful Data on How Consumers Use Supplemental Benefits

Despite evidence that Medicare Advantage’s (MA) supplemental benefits are a key driver of strong enrollment in Medicare’s private plan option, information about consumer use of those benefits remains limited. Supplemental benefits are a defining feature of MA, yet data are lacking on how many enrollees use them, who is accessing them, the specific services used, and which benefits are most meaningful to consumers.

This data gap is especially troubling given that MA now covers about half of all people with Medicare (about 33 million individuals), and the federal government will spend an estimated $18 billion[1] on MA’s extra benefits this year—a near historic high. Better information would enable greater transparency on supplemental benefits’ reach and help policymakers ensure those benefits meaningfully support enrollees’ health and well-being. More robust data could also advance important goals of improved value and equity in the Medicare program.

Why better supplemental benefits data matter

In theory, MA’s extra benefits help address a broad range of needs that can influence enrollees’ overall health outcomes. MA plans have historically included supplemental benefits such as dental, vision, hearing, and fitness. Then starting in 2019, significant federal policy changes allowing a broader range of benefits ushered in new health-related services (e.g., in-home assistance, support for caregivers, therapeutic massage) and non-medical benefits (e.g., meals and groceries, housing support, non-medical transportation).

Yet, assessing whether supplemental benefits are meeting their intended goal continues to be challenging. Lack of data about MA enrollees’ use of supplemental benefits means that policymakers cannot adequately determine whether they are reaching consumers, if there is appropriate, affordable, and equitable access to them, and, ultimately, whether they are leading to improved health. Better data about utilization could also help identify benefits of high value to consumers and inform policymakers about further needed changes to allowable services. Finally, improved data could provide important insights into whether supplemental benefits as a whole are playing an appropriate role in consumers’ enrollment decisions.

In evaluating policies that impact Medicare’s fiscal outlook, more complete supplemental benefits data could help policymakers better assess whether Medicare dollars spent on extra benefits are being used effectively to address consumer needs.

Lost opportunities for meaningful reporting

While the Centers for Medicare & Medicaid (CMS)—the federal agency that runs the Medicare program—requires MA insurers to report data on supplemental benefits annually, those data are mostly limited to describing plans’ offerings. By and large, they are inadequate for purposes of understanding if MA enrollees are actually accessing supplemental benefits, which ones they are using, or how meaningful they are for consumers.

Missed opportunities exist for more complete information. Data collected when MA enrollees see a health care provider to use a covered service, called MA encounter data, could theoretically be a rich source of information on consumer use of supplemental benefits. However, in practice, insurers often fail to report supplemental benefit statistics in the encounter data.

Other available data are similarly flawed. Medicare survey data, MA bid data (used to determine federal payments to MA insurers), and medical loss ratio data (used to measure the share of premium dollars insurers spend on health care versus administrative costs and profit) do not include detailed supplemental benefits utilization reports and lack complete information about newer benefits.

Promising steps, but more needed 

CMS has begun to take action to fill gaps in supplemental benefits data. Last year the agency started requiring that some MA plans—those participating in a nationwide pilot known as the MA-Value Based Insurance Design (VBID) Model—submit detailed information on their enrollees’ use of all covered supplemental benefits. The VBID model is significant in size, covering an estimated 12 million individuals, or about four out of 10 people with MA. Encouragingly, CMS has proposed to extend a similar requirement to all MA plans. Implementing this proposal could go a long way toward improving supplemental benefits data. Finally, the agency recently released MA encounter data guidelines clarifying the requirement that insurers include supplemental benefits in their reporting. The guidelines provide some instructions and other information to do so.

Still, opportunities remain for greater transparency on consumer use of supplemental benefits. Earlier this year, CMS released a request for information seeking the public’s feedback on, among other things, collecting supplemental benefits utilization data. Some experts, meanwhile, have called for further improvements to the supplemental benefits information in the encounter data. In addition, stakeholders have highlighted the need to develop shared standards that support high-quality, individual-level data. They have also emphasized the importance of CMS making data on supplemental benefits use publicly available, in a timely manner.

Ultimately, filling the information gap on MA enrollees’ use of supplemental benefits is critical to strengthen policymakers’ ability to make informed coverage and funding policies for MA. It would be one important step forward in helping to ensure a stronger Medicare program for the millions of people who rely on it for their health care coverage.

[1] AARP Public Policy Institute estimate based on data from the 2023 Medicare Trustees’ Report and the Medicare Payment Advisory Commission’s (MedPAC) March 2024 Report to the Congress.

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