Medicare Benefit Enrollees Account for a Rising Share of Inpatient Hospital Days | KFF

Enrollment in Medicare Benefit has grown quickly in recent times, with greater than half of all eligible Medicare beneficiaries now receiving their Medicare protection from a personal plan. The rise in Medicare Benefit enrollment has implications for beneficiaries and well being care suppliers, together with hospitals, as a result of Medicare Benefit differs from conventional Medicare in some ways.

Not like conventional Medicare, Medicare Benefit plans usually require prior authorization earlier than protecting some providers. Virtually all Medicare Benefit enrollees are in a plan that requires prior authorization for inpatient hospital stays (98%) and post-acute expert nursing facility stays (99%). Prior authorization necessities are meant to scale back pointless care and decrease prices, but in addition impose administrative burdens on well being care suppliers, and will result in delays and obstacles to care.

Medicare Benefit plans sometimes set up networks of suppliers, together with (or excluding) hospitals, and impose larger out-of-pocket prices for enrollees who acquire care from out-of-network suppliers. As enrollment in Medicare Benefit grows, selections made by insurers about which hospitals to incorporate within the community, and selections made by hospitals about whether or not to be in a Medicare Benefit community, could be anticipated to have an effect on a bigger share of the Medicare inhabitants.

Just lately, some hospitals, well being methods, and medical teams have raised concerns in regards to the affect of Medicare Benefit on their funds, with some terminating or threatening to terminate contracts with insurers over delays in fee, extra restrictive protection determinations, and fee charges. One problem that has not too long ago drawn scrutiny from these teams has been Medicare Benefit plans’ apply of shifting hospitalized sufferers to “commentary standing,” which frequently means decrease funds to hospitals and better prices for sufferers.

This knowledge notice examines the expansion of Medicare Benefit as a share of hospital inpatient days between 2015 and 2022 utilizing knowledge from hospital value stories submitted to the Facilities for Medicare and Medicaid Companies (CMS). This evaluation paperwork the share of hospital inpatient days attributable to Medicare Benefit throughout common short-term hospitals with full-year value stories in a given 12 months, excluding those who had been lacking knowledge or within the U.S. territories.

Key Takeaways

• Medicare Benefit represents a rising share of whole hospital inpatient days. Medicare Benefit grew from 13% to 23% of inpatient hospital days, and as of 2022, almost half (48%) of all Medicare inpatient hospital days had been attributable to Medicare Benefit enrollees.
• Three in ten hospitals had extra inpatient days from Medicare Benefit enrollees than conventional Medicare enrollees in 2022. The share of hospitals with extra Medicare Benefit than conventional Medicare inpatient days grew from 5% in 2015 to 30% in 2022.
• Medicare Benefit inpatient day shares have grown quickest at non-metropolitan hospitals. The share of inpatient hospital days attributable to Medicare Benefit enrollees greater than doubled in non-metropolitan counties between 2015 and 2022.
• The share of inpatient hospital days for Medicare Benefit enrollees assorted extensively throughout counties in 2022. Medicare Benefit inpatient day shares had been highest in counties with larger Medicare Benefit penetration, and lowest in these with decrease Medicare Benefit penetration.
• Inside counties, the share of inpatient days attributable to Medicare Benefit enrollees additionally assorted extensively throughout hospitals in 2022. For instance, in Allegheny County, PA (a county with comparatively excessive Medicare Benefit penetration), inpatient days attributable to Medicare Benefit enrollees ranged from 11% to 58% throughout hospitals. Equally, there was massive variation in counties with lower-than-average penetration, comparable to in Oklahoma County, Oklahoma, the place the Medicare Benefit inpatient day share ranged from near 0% to 24% throughout hospitals.

Medicare Benefit steadily elevated as share of inpatient days between 2015 and 2022, whereas the share attributable to conventional Medicare decreased.

The share of whole inpatient days attributed to Medicare Benefit enrollees grew from 13% in 2015 to 23% in 2022 amongst common short-term hospitals within the U.S (see Determine 1). Throughout this identical interval, the share of inpatient days attributed to conventional Medicare declined from 34% to 25%. As of 2022, almost half (48%) of all Medicare inpatient days had been attributable to Medicare Benefit sufferers. The rise within the share of inpatient days attributable to Medicare Benefit enrollees coincided with a rise in Medicare Advantage enrollment as a share of all eligible Medicare beneficiaries from 32% in 2015 to 48% in 2022.

The share of hospitals with extra inpatient days from Medicare Benefit than conventional Medicare elevated from 5% in 2015 to 30% in 2022.

The rise in Medicare Benefit enrollment has contributed to a shift in affected person combine throughout hospitals, affecting some greater than others. The share of hospitals with extra Medicare Benefit than conventional Medicare inpatient days elevated from simply 5% in 2015 to 30% in 2022 (Determine 2). Hospitals with a better share of sufferers from Medicare Benefit than conventional Medicare could also be extra reliant on income from these plans, and extra affected by numerous plan guidelines and selections, comparable to prior authorization necessities, denials of claims, commentary keep designations, and community restrictions.

Amongst hospitals in non-metropolitan counties, the share of inpatient days for Medicare Benefit enrollees greater than doubled between 2015 and 2022.

Throughout all rural hospitals, the share of inpatient days attributed to Medicare Benefit has been persistently decrease than in metropolitan areas, however greater than doubled over the research interval, rising from 7% in 2015 to fifteen% in 2022 (Determine 3). The Medicare Benefit share of inpatient days additionally greater than doubled in micropolitan areas, the place it grew from 9% in 2015 to 21% in 2022. Enrollment in Medicare Benefit is decrease in rural areas than in metropolitan or micropolitan areas, although it grew swiftly throughout this era, rising from 18% to 40% of eligible beneficiaries between 2015 and 2022. Some rural hospitals have raised concerns that negotiated charges paid by Medicare Benefit insurers are sometimes decrease than charges paid by conventional Medicare. As Medicare Benefit enrollment continues to climb, and as Medicare Benefit enrollees comprise a bigger share of sufferers, rural hospitals could face new challenges.

Medicare Benefit comprised the next share of inpatient days in counties with larger Medicare Benefit penetration.

Throughout the nation, the share of Medicare beneficiaries enrolled in Medicare Benefit varies widely. As could be anticipated, counties with larger Medicare Benefit penetration had bigger Medicare Benefit shares of inpatient days than counties with decrease Medicare Benefit penetration. Amongst counties within the prime quartile of Medicare Benefit penetration, Medicare Benefit comprised 27% of inpatient days in 2022 (Determine 4), considerably better than the 15% share among the many backside quartile of counties.

The share of inpatient days attributable to Medicare Benefit enrollees assorted extensively throughout hospitals inside counties in 2022.

Though the share of inpatient days attributed to Medicare Benefit tracked county-level Medicare Benefit penetration, there was massive variation inside counties. The determine under illustrates the vary in Medicare Benefit inpatient days as a share of whole inpatient days for a set of counties which have a number of hospitals and are geographically dispersed in every quartile of Medicare Benefit penetration. For instance, in Allegheny County, PA, a excessive penetration county, the place 73% of eligible Medicare beneficiaries had been enrolled in a Medicare Benefit plan in 2022, Medicare Benefit enrollees accounted for simply 11% of all inpatient days in a single hospital however greater than half in others.

Even in comparatively low penetration counties, there was substantial variation within the share of inpatient days attributed to Medicare Benefit. As an example, in Oklahoma County, Oklahoma, the place 38% of beneficiaries had been enrolled in a Medicare Benefit plan, the Medicare Benefit inpatient day share ranged from near 0 to 24%.

Variations in Medicare Benefit inpatient day shares throughout hospitals inside the identical county could also be resulting from quite a lot of elements together with whether or not a given hospital is included in Medicare Benefit networks, the extent to which a given hospital tends to serve folks with Medicare based mostly on the sorts of providers and procedures it supplies, and beneficiary preferences that could be based mostly on comfort or perceived high quality. As famous above, hospitals with a comparatively massive variety of sufferers from Medicare Benefit could also be extra affected by prior authorization necessities, denials of claims, commentary keep designations, and community restrictions of those plans. As Medicare Benefit enrollment continues to rise, the selections made by Medicare Benefit plans associated to reimbursement, protection, and networks may have income implications for hospitals and different well being care suppliers that may be anticipated to range throughout counties and inside native markets.

Strategies

This evaluation attracts on quite a lot of knowledge sources. Knowledge on inpatient days and hospital traits got here from RAND Hospital Knowledge, which is a cleaned and processed model of annual value report knowledge that Medicare-certified hospitals are required to undergo the Healthcare Price Report Info System (HCRIS). To our information, the accuracy of reported conventional Medicare and Medicare Benefit days in hospital value report knowledge has not been evaluated. Hospitals report mixed days for Medicare Benefit and price plan enrollees. Price plans account for a negligible share of Medicare enrollment, so we check with the mix as “Medicare Benefit days” all through. County-level Medicare Benefit penetration was calculated from Medicare enrollment data. Enrollment knowledge is barely offered for plan-county mixtures which have not less than 11 beneficiaries, and a few counties don’t have plans that meet this threshold. We assumed these counties had 0% Medicare Benefit penetration. Core Based mostly Statistical Space (CBSA) classifications had been used to designate hospitals as being in metropolitan or micropolitan counties. Metropolitan CBSAs comprise not less than one city space with 50,000 or extra inhabitants, and micropolitan CBSAs comprise not less than one city space with not less than 10,000 however fewer than 50,000 inhabitants. We categorised counties not situated in CBSAs as rural.

We restricted this evaluation to common short-term hospitals and excluded hospitals in U.S territories. Price stories mirror various reporting intervals that always don’t align with a calendar 12 months. We assigned value stories to calendar years based mostly on the 12 months that the fee report resulted in. We solely examined value stories that coated 365 or three hundred and sixty six days (known as “full-year value stories”). These restrictions left 4,389 value stories in 2022. Of those 4,389 value stories, we analyzed 3,772 that weren’t excluded from the evaluation resulting from lacking Medicare Benefit or conventional Medicare inpatient days, or resulting from uncommon circumstances (2 value stories in 2022) the place mixed Medicare Benefit and conventional Medicare inpatient days exceeded the entire inpatient days reported by the hospital, suggesting inaccurate knowledge.

Fourteen % of the 4,389 value stories described above had been lacking knowledge for Medicare Benefit inpatient days in 2022 (in comparison with lower than 1% for inpatient days total and 1.3% for conventional Medicare days). The 14 % of hospitals that had been lacking Medicare Benefit knowledge had been extra more likely to be small or rural and accounted for lower than 2 % of all inpatient days. Not one of the stories in our pattern reported zero Medicare Benefit inpatient days. It’s unclear whether or not and when lacking values characterize zero days. We suspect that Medicare Benefit could characterize a comparatively small share of inpatient days on common amongst hospitals with lacking knowledge, partly as a result of hospitals with comparatively few Medicare Benefit days have a smaller incentive to trace and report lately when required for extra reimbursement beneath conventional Medicare (e.g., for medical schooling changes).

We carried out sensitivity analyses to discover the implications of lacking Medicare Benefit knowledge. First, we ran analyses excluding teams of hospitals that had been most probably to be lacking knowledge, comparable to Important Entry Hospitals and hospitals with fewer than 25 beds. Second, we ran analyses that assumed that hospitals with lacking knowledge had zero Medicare Benefit inpatient days, which might be the decrease certain of the doable Medicare Benefit shares at these hospitals. Third, we ran our evaluation of total and rural hospital Medicare Benefit share tendencies utilizing hospitals that had Medicare Benefit knowledge for all years (2015 by 2022). Totally different approaches elevated or decreased common Medicare Benefit shares—e.g., with decrease shares when changing lacking values with zeroes and better shares when excluding small hospitals and Important Entry Hospitals—and particularly so amongst rural hospitals. Nonetheless, our fundamental findings that there have been massive will increase in Medicare Benefit as a share of inpatient days throughout hospitals in rural, micropolitan and metropolitan areas alike and that shares had been larger in counties with better Medicare Benefit penetration was true throughout all of our sensitivity analyses.