Utilization and Efficiency Under Medicare Advantage vs. Medicare Fee-for-Service

This white paper examines the differences in healthcare utilization and efficiency between Medicare Advantage (MA) and Medicare Fee-for-Service (FFS) for comparable populations. It documents findings from a study conducted by Harvard and Inovalon, which utilized Inovalon’s Medical Outcomes Research for Effectiveness and Economics (MORE2) Registry dataset. The research focuses on beneficiaries who turned 65 between 2015 and 2019, analyzing their healthcare resource utilization during the two years following their Medicare enrollment. The study reveals that MA enrollees experience significantly lower inpatient stays and emergency visits compared to FFS, while maintaining similar levels of primary care and prescription drug utilization. The findings indicate that overall healthcare costs are lower under MA. The paper aims to provide valuable analytics for health plans and policymakers, enabling them to benchmark MA plan performance and identify opportunities for operational improvements. Future research is anticipated to explore quality of care and health equity outcomes in relation to MA and FFS.