Medicare Advantage plans and the Impact on Nursing Home Selection

Private insurers offer Medicare Advantage plans as an alternative to traditional Medicare.  The government pays Medicare Advantage plans a fixed monthly fee to provide services to Medicare beneficiaries under their care.  The services must at least be equal to regular Medicare. While the plans sometimes offer benefits that original Medicare does not (for example, some preventative benefits) the plans typically only cover care provided by doctors in their network.

A new study, conducted by Brown University School of Health, has found that people enrolled in a Medicare Advantage plan were more likely to enter a lower-quality nursing home than were people in traditional Medicare. The study raises questions about whether Medicare Advantage plans are influencing beneficiaries’ decision making when it comes to choosing a nursing home.

The study does not draw any conclusions about whether the Medicare Advantage beneficiaries fared worse than original Medicare beneficiaries, only that they tended to enter facilities that had higher re-hospitalization rates and worse outcomes. The study concluded that Medicare Advantage plans may be influencing beneficiary decision-making around nursing home selection.

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