At the same time, MA plans are rapidly embracing a wide range of social services and supports for older adults living at home. Sometimes called long-term care lite, these benefits range from meal and food deliveries to transportation, home modifications, and adult day health care.
A new report by the Long-Term Care Quality Alliance (LTQA) and the consulting firm ATI Advisory finds an explosion of plan interest in offering these non-medical benefits. The study found that nearly one-third of all plans—more than 1,800 in all—are offering some of these extra benefits in plan year 2022, more than three times the number in 2020.
LTQA and ATI estimate that 98 percent of MA enrollees have access to a plan offers some of these benefits. About 7 million people are enrolled in plans that offer supplemental benefits.
These new benefits are allowed under multiple, extremely complex federal rules. In 2019, the Centers for Medicare and Medicaid Services (CMS) redefined “primarily health-related” benefits to include some assistance called Expanded Primarily Health-Related Benefits (EPHRB). These included benefits such as adult day health care, home-based palliative care, family caregiver supports, and certain in-home supportive services.
In 2020, Congress enacted the CHRONIC Act that allowed plans to offer what it calls non-primarily health-related Special Supplemental Benefits for the Chronically Ill (SSBCI). They include meals and food delivery, non-medical transportation, home modifications, general support for care at home, and even pest control. There are other pathways to these benefits as well.
Importantly, plans can target these new benefits to individual enrollees rather than making the same benefits available to every member, whether they need them or not.
The plans provide most of these services with what are effectively bonuses they receive from Medicare for providing efficient care. Because these extra payments are relatively modest, the value of the supportive services they offer are similarly modest—generally $50/month or less.
The ATI research shows how plans are beginning to adjust the services they offer. For example, seven times as many plans offered food delivery in 2022 as in 2020, and six times as many plans offered meals delivery. The number of plans offering non-medical transportation tripled.
At the same time, the number of plans offering therapeutic massages and adult day health care declined for Plan Year 2022—most likely because the pandemic severely curtailed these services until very recently.
A black box
However, Medicare does not require the plans to disclose how many of their members actually are receiving benefits. And the plans themselves won’t disclose this information. So, at least for now, these benefits are something of a black box. There is no way to know how profitable these services are to the plans or whether they really benefit their members.
Health and long-term care experts have long speculated that social services and personal care for frail older adults can reduce preventable illness or injury and thus lower medical costs. That is important for MA plans, which are paid a monthly per member fee by Medicare (generally around $1,000), but are fully at risk for their members medical costs.
Since even one brief hospitalization can eat up a year’s Medicare payments, the plans have a strong incentive to keep their members as healthy as possible. And their revealed preference seems so show that offering supplemental benefits does reduce those medical costs.
Not long-term care
Six insurers–UnitedHealth, Humana, CVS, Anthem, Centene, and Cigna– account for almost half of all MA enrollment, according to an analysis by the news organization Axios. However, many smaller players see opportunities and are trying to get into the MA business. Together, these insurance companies operate thousands of individual plans around the country. More than 40 percent of Medicare enrollees now are members of MA plans.
The supportive services the plans offer today should not be confused with full-blown long-term care. A monthly benefit valued at $40 or $50 falls far short of a $200-a-day long-term care insurance benefit that may pay for, say, seven hours of a home care aide. And the MA benefits are available only to people still living at home. They do not cover nursing home care.
But this alphabet soup of new benefits begins to widen an opening for Medicare to provide personal care for the chronically ill. Lawmakers already are discussing the idea of an even more flexible, and perhaps more generous, CHRONIC Act 2.0.
And, in theory at least, MA plans could offer far more robust, premium-based, long-term care coverage. None are, for now. But they could.
That still leaves one more big open question: Will the government ever find a way to offer benefits such as these through traditional Medicare?
Full disclosure: I serve as an unpaid member of an advisory panel to LTQA on MA supplemental benefits.