Coverage of Fitness by Medicare Advantage Plans: Which Causes Which?

The kind of enrollee Medicare
Advantage plans want.

Many years ago, the newly-minted managed care medical director Disease Management Care Blog accompanied a marketing VP on a business visit to a fitness club. We were interested in knowing if the club would offer a discount to our health plan members.  During the tour of the facility's weight rooms, basketball courts and group exercise rooms, we came across a large swimming pool filled with bathing-capped seniors. "Those people," thought the DMCB, "are precisely the ones we want in our insurance plan."

Enter the paradox of offering fitness and wellness as a covered health insurance benefit. While the assumption has been that fitness causes an enrolled population to be healthier, it's just as possible for persons who are already healthy in the first place to be attracted to health plans that cover fitness.  Managed care executives have known about this for a long time, but until now, no one has really measured the effect.

Enter this elegant study by Alicia Cooper and Amal Trivedi, just published in the January 12 New England Journal. Eleven Medicare Advantage (MA) health plans that added fitness as a covered benefit in either 2004 or 2005 were matched to 11 plans that did not add a fitness benefit. On average, the plans were predominantly nonstaff and nongroup models and median duration of being in business was just over ten years. The "fitness" plans had a median population of 31,540 members while the control plans had a median membership of 18,241

The authors next looked for Medicare beneficiary members in those 22 plans who had completed a "Medicare Health Outcomes Survey" (MHOS) at the time of their enrollment. This yielded 4,852 beneficiaries who were in one of the eleven "fitness MA plans" and 5,064 beneficiaries in one of the eleven "no fitness MA plans." Age, gender and the burden of illness was similar in both groups, while they differed slightly with respect to race, education and income.

The key question from the survey that was used in this analysis was self-reported health status. In the years prior to instituting the fitness benefit, the percent of newly enrolled persons reporting excellent or very good health in the MHOS was 29.1%.  After the fitness benefit was instituted, it increased to 35.1%.  Plans without fitness programs during that same period went from 28.5% to 30%. This contrast between a 6% increase versus a 1.5% increase was statistically significant.

The good news is that the folks in Medicare are well aware of the impact of unequal enrollment between MA plans and use risk adjustment to even out the payment levels. The bad news is that risk adjustment is notoriously inaccurate and, to the DMCB's knowledge, probably doesn't capture that 6% shift described above.  Assuming the MHOS survey results translate into lower claims expense, that could represent some serious money in a program that is already under fire for over-payment.

Before readers condemn the MA plans for consciously using their fitness plans to attract a lower cost population, note that the same MA plans have been offering disease management programs for persons with chronic and costly conditions.  When compared to fee-for-service Medicare, these programs may be attracting sicker seniors.  Between MA plans, those with a better reputation for investing in chronic care population health management are more likely to attract a higher percent of persons with diabetes and heart disease. In other words, it works both ways.

What should the next step be?  Follow-up MHOS results for those individuals who entered with a low score to determine if there was any improvement among those in "fitness" MA plans versus those plans without the fitness benefit.  The DMCB looks forward to seeing those results hopefully soon.

In retrospect, the DMCB should have suspected something was up years ago.  After all, it was accompanying a marketing VP and, whether we knew it or not, the visit was really all about those seniors in the pool.