The impact of Medicare Advantage on Health Care, Management of Comorbid Conditions, and Potentially Inappropriate Medication Use, for Beneficiaries with Alzheimer's Disease and Its Related Dementias

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Project Summary / Abstract Over 6 million adults in the U.S. are living with Alzheimer's Disease and Alzheimer's Disease Related Dementias (ADRD), a population estimated to double by 2050. Medicare costs associated with individuals with AD/ADRD are more than three times higher than for those without and the total Medicare spending for beneficiaries with AD/ADRD is projected to reach $584 billion in 2050. People with ADRD are also characterized by higher complexity of comorbid conditions and coordination of care. There is evidence of potentially inappropriate or suboptimal care for individuals with ADRD. Medicare Advantage (MA) provides a potential opportunity to improve the efficiency and quality of treatment for individuals with ADRD. Because MA plans receive capitated monthly payments from Medicare, they have strong financial incentive to manage chronic conditions and avoid unnecessary health care use. However, MA plans' incentives to control costs could also lead to reduction in beneficial care for enrollees with AD/ADRD. Prior research suggest that MA enrollment is associated with lower healthcare utilization for ADRD individuals, but the results were based on cross-sectional comparisons in self-reported outcomes between MA and TM, which could have biased estimates if MA enrollees differed from TM enrollees in unobserved ways. With the growing share of Medicare beneficiaries enrolled in MA, it is important to understand the causal effects of MA coverage on health care use and outcomes for beneficiaries with ADRD. Our proposed project will use plausibly exogenous variation in MA enrollment in seven states that shifted public retiree health benefits from TM with supplemental plans to mandatory MA plans (or in one state, from a mandatory MA plan to TM coverage) in 2016-2019. We will use these natural experiments, along with comprehensive Medicare data for TM and MA enrollees, to estimate the causal effects of MA coverage on health care use, management of comorbid conditions, potentially inappropriate medication use and polypharmacy, and institutionalization for individuals with ADRD. These results will provide insights on the relative benefits and harms of MA enrollment for this vulnerable population and contribute important evidence to policymakers weighing broader expansions of Medicare Advantage.