Medicare Advantage plans were paid more than $1 billion for veterans who did not use any Medicare services, according to a study published in the November issue of Health Affairs.
The number of veterans enrolled in Medicare Advantage increased between 2016 and 2022, the study found. An increasing number of veterans enrolled in plans where 20% or more of the beneficiaries were veterans, which the study described as disproportionate.
Many Medicare Advantage insurers offer plans marketed to veterans. The plans often include benefits designed to complement Veterans Health Administration benefits.
The federal government effectively pays twice when veterans enrolled in Medicare Advantage receive care through the VHA, according to the study's authors. MA plans may receive duplicative payments because CMS pays MA plans a fixed amount per member, per month, regardless of the care they utilize.
The VHA cannot collect reimbursement from Medicare, including MA plans.
Around one in five veterans enrolled in MA plans with high-veteran enrollment did not use any services paid by their MA plan in a given year, the study found. This rate was 2.5 times higher than veterans enrolled in other MA plans, and 5.7 times higher than in the general population.
In 2020, CMS paid more than $1.32 billion to MA insurers for veterans who did not use any Medicare services, the study found.
As of 2022, 1.3 million veterans were enrolled in MA plans, accounting for around one in three veterans enrolled in Medicare.
The potentially duplicative payments to MA plans for veterans' care highlight a "growing dilemma" for CMS, the study's authors wrote.
"The growth of high-veteran MA plans underscores the urgent need for policy interventions to enhance efficiency and care coordination between CMS and the VHA," the study's authors wrote.
The study was conducted by researchers at Harvard University and Boston University.
Read the full study here.