Competitive bidding in Medicare: who benefits from competition?

ABSTRACT:

Objectives

To conduct the first empirical study of competitive bidding in Medicare.

Study design and methods

We analyzed 2006-2010 Medicare Advantage data from the Centers for Medicare and Medicaid Services using longitudinal models adjusted for market and plan characteristics.

Results

A $1 increase in Medicare's payment to health maintenance organization (HMO) plans led to a $0.49 (P <.001) increase in plan bids, with $0.34 (P <.001) going to beneficiaries in the form of extra benefits or lower cost sharing. With preferred provider organization and private fee-for-service plans included, higher Medicare payments increased bids less ($0.33 per dollar), suggesting more competition among these latter plans.

Conclusions

As a market-based alternative to cost contro

SUBMITTER: Song Z 

PROVIDER: S-EPMC3519284 | biostudies-literature | 2012 Sep

REPOSITORIES: biostudies-literature