The federal program that covers medical care for people age 65 or older, younger people with disabilities, and people with End-Stage Renal Disease. Medicare covers about 13% of the US population and makes up a fifth of national health expenditures.

What Do We Know About Health Insurance Choice?

Issue Brief
Jun. 30, 2020

From choosing a doctor to selecting an insurance plan, choices pervade nearly all aspects of our health care system. However, there is little agreement among policymakers and the public about what constitutes “choice,” which choices are important, and how and whether patients should be asked to make various health care choices. Although Americans claim to value having health insurance choices, research shows that when presented with options, people do not actually like to choose. Other studies suggest that people frequently make health insurance decisions that leave them worse off, or not much better than before. At Penn LDI’s Medicare for All and Beyond conference, a panel of researchers and policy experts discussed the current evidence around health insurance choice and implications for future health care reform efforts. This brief summarizes the panel’s key takeaways.

Payment and Pricing Decisions in Health Care Reform

Issue Brief
Jun. 23, 2020

Any effort to reform health insurance in the United States must tackle the prices we pay for health care. There are many complex challenges to addressing prices. Some proposals build on the existing Medicare fee schedule, while others suggest promoting alternative payment mechanisms—or even starting from scratch. The stakes are substantial, as many reform proposals rely on reining in prices to achieve the savings necessary to expand health insurance to the uninsured. At Penn’s LDI Medicare for All and Beyond conference, a panel of researchers, hospital administrators, and policy experts considered issues related to health care payment and pricing that any health care reform proposal must address, including the implications of rate setting for providers and patients. At what level should these rates be set to assure access and quality of care, while incentivizing innovation and rewarding excellence?

Setting Standards for Affordable Health Care

Issue Brief
Jun. 16, 2020

In the run-up to the presidential election, the affordability of health care remains a top concern of the American voting public. But how do we know when health care is affordable? On a policy level, how do we set a standard for affordability that can be implemented in a reformed system? Sometimes policy debates about affordability focus only on whether insurance premiums are affordable, although consumers tend to be concerned about both premiums and out-of-pocket costs. At Penn LDI’s Medicare for All and Beyond conference, a panel of researchers, policy experts, and consumer advocates discussed and debated affordability in theory and practice. This issue brief summarizes the panel’s insights.

Pediatric Outpatient Utilization By Differing Medicaid Payment Models In The United States

Jun. 12, 2020

Therese L Canares, Ari Friedman, Jonathan Rodean, Rebecca R. Burns, Deena Berkowitz, Matt Hall, Elizabeth Alpern, Amanda Montalbano

Abstract [from journal]

Background: In the United States (US), Medicaid capitated managed care costs are controlled by optimizing patients' healthcare utilization. Adults in capitated plans utilize primary care providers (PCP) more than emergency departments (ED), compared to fee-for-service (FFS). Pediatric data are lacking. We aim to determine the association between US capitated and FFS Medicaid payment models and children's outpatient utilization.

Methods: This retrospective cohort compared outpatient utilization


Recent Trends In Medicare Utilization And Reimbursement For Lumbar Spine Fusion And Discectomy Procedures

Jun. 10, 2020

Cesar D. Lopez, Venkat Boddapati, Joseph M. Lombardi, Nathan J. Lee, Comron Saifi, Marc Dyrszka, Zeeshan Sardar, Lawrence G. Lenke, Ronald A Lehman

Abstract [from journal]

Background context: Understanding the scope of the volume and costs of lumbar fusions and discectomy procedures, as well as identifying significant trends within the Medicare system, may be beneficial in enhancing cost-efficiency and care delivery. However, there is a paucity of studies which analyze recent trends in lumbar fusion volume, utilization, and reimbursements.

Purpose: This study seeks to define the costs of lumbar fusions and discectomy procedures and identify trends and variations


The Influence Of Medicare for All On Reimbursement For Emergency Care Treat-and-Release Visits

May. 24, 2020

Alexander Pomerantz, Ryan Burke, Ari Friedman, Laura Burke, Richard Wolfe, Peter Smulowitz

Abstract [from journal]

Study objective: Single-payer health care is supported by most Americans, but the effect of single payer on any particular sector of the health care market has not been well explored. We examine the effect of 2 potential single-payer designs, Medicare for All and an alternative including Medicare and Medicaid, on total payments and out-of-pocket spending for treat-and-release emergency care (patients discharged after an emergency department [ED] visit).

Methods: We used the 2013 to 2016 Medical


Physician Groups in ACOs Don’t Avoid Vulnerable Patients

May. 21, 2020

Accountable care organizations (ACOs) are the largest experiment in payment reforms, but the incentive structure may lead participating physician groups to select fewer vulnerable patients. In a new study in JAMA Network Open, my colleagues and I tested whether physician groups changed their proportions of black patients and patients with low socioeconomic status after joining the Medicare ACO, and found that – in general – they did not.

Surgical Care in Accountable Care Organizations

May. 12, 2020

Accountable care organizations (ACOs) figure prominently in Medicare’s shift “from volume to value.” Providers in ACOs assume financial accountability for overall quality and costs for a defined patient population, and they earn shared savings for containing spending below a defined benchmark. To date, most ACOs have focused on primary care, outpatient services, and care management for patients with chronic medical conditions, such as diabetes and heart failure.

Health Care Cost Drivers and Options for Control

Issue Brief
Apr. 28, 2020

The growth of health care costs remains a serious concern in the United States. Slowing this growth involves understanding what drives health care costs and how to target those drivers effectively. In this brief, we review the relative importance of different health care cost drivers, including insurance benefits design, price inflation, provider incentives, technological growth, and inefficient system performance. We analyze the impact of these factors on the growth of health care spending in the last decade, which has been concentrated in hospitals and felt most acutely in the private market.

Paying Twice for the Same Service for Veterans in Medicare Advantage Plans

Apr. 13, 2020

Over a four-year period, the federal government double-paid for the health care of 4,764 recipients of coronary revascularization procedures, leading to $214 million in redundant spending. This wasteful spending occurs due to policies governing the Medicare Advantage program for Veterans that do not reflect how the U.S. health care system is currently structured. We published these findings last week in JAMA Network Open.[content_elements:element:0]

The Impact of Medicare's Alternative Payment Models on the Value of Care

Apr. 2, 2020

Joshua M. Liao, Amol S. Navathe, Rachel M. Werner

Abstract [from journal]

Over the past decade, the Centers for Medicare and Medicaid Services (CMS) have led the nationwide shift toward value-based payment. A major strategy for achieving this goal has been to implement alternative payment models (APMs) that encourage high-value care by holding providers financially accountable for both the quality and the costs of care. In particular, the CMS has implemented and scaled up two types of APMs: population-based models that emphasize accountability for overall quality and costs for defined patient populations, and episode-based


Relative Contributions of Hospital Versus Skilled Nursing Facility Quality on Patient Outcomes

Mar. 30, 2020

Paula Chatterjee, Mingyu Qi, Rachel Werner

Abstract [from journal]

Background: Hospitals and health systems worldwide have adopted value-based payment to improve quality and reduce costs. In the USA, skilled nursing facilities (SNFs) are now financially penalised for higher-than-expected readmission rates. However, the extent to which SNFs contribute to, and should thus be held accountable for, readmission rates is unknown. To compare the relative contributions of hospital and SNF quality on readmission rates while controlling for unobserved patient characteristics.



Health Care Utilization, Care Satisfaction, and Health Status for Medicare Advantage and Traditional Medicare Beneficiaries With and Without Alzheimer Disease and Related Dementias

Mar. 2, 2020

Sungchul Park, Lindsay White, Paul Fishman, Eric B. Larson, Norma B. Coe

Abstract [from journal]

Importance: Compared with traditional Medicare (TM) fee-for-service plans, Medicare Advantage (MA) plans may provide more-efficient care for beneficiaries with Alzheimer disease and related dementias (ADRD) without compromising care quality.

Objective: To determine differences in health care utilization, care satisfaction, and health status for MA and TM beneficiaries with and without ADRD.

Design, Setting, and Participants: A cohort study was conducted of MA and TM beneficiaries with