Duplicate federal payments for dual enrollees in Medicare Advantage plans and the Veterans Affairs health care system

Abstract

Context: Some veterans are eligible to enroll simultaneously in a Medicare Advantage (MA) plan and the Veterans Affairs health care system (VA). This scenario produces the potential for redundant federal spending because MA plans would receive payments to insure veterans who receive care from the VA, another taxpayer-funded health plan.

Objective: To quantify the prevalence of dual enrollment in VA and MA, the concurrent use of health services in each setting, and the estimated costs of VA care provided to MA enrollees.

Design: Retrospective analysis of 1,245,657 veterans simultaneously enrolled in the VA and an MA plan between 2004-2009.

Main outcome measures: Use of health services and inflation-adjusted estimated VA health care costs.

Results: Among individuals who were eligible to enroll in the VA and in an MA plan, the number of persons dually enrolled increased from 485,651 in 2004 to 924,792 in 2009. In 2009, 8.3% of the MA population was enrolled in the VA and 5.0% of MA beneficiaries were VA users. The estimated VA health care costs for MA enrollees totaled $13.0 billion over 6 years, increasing from $1.3 billion in 2004 to $3.2 billion in 2009. Among dual enrollees, 10% exclusively used the VA for outpatient and acute inpatient services, 35% exclusively used the MA plan, 50% used both the VA and MA, and 4% received no services during the calendar year. The VA financed 44% of all outpatient visits (n = 21,353,841), 15% of all acute medical and surgical admissions (n = 177,663), and 18% of all acute medical and surgical inpatient days (n = 1,106,284) for this dually enrolled population. In 2009, the VA billed private insurers $52.3 million to reimburse care provided to MA enrollees and collected $9.4 million (18% of the billed amount; 0.3% of the total cost of care).

Conclusions: The federal government spends a substantial and increasing amount of potentially duplicative funds in 2 separate managed care programs for the care of same individuals.

Figure 1

Trends in Dual Enrollment in VA and Medicare Advantage (MA), 2004–2009 VA indicates Veterans Affairs health care system.

Figure 2

Estimated VA Health Care Costs for Medicare Advantage Enrollees, 2004–2009 VA indicates Veterans Affairs health care system.

Figure 3

Estimated Per-Capita VA Health Care Costs for Medicare Advantage Enrollees, 2004–2009 Error bars indicate 95% CIs. VA indicates Veterans Affairs health care system.