Constrained Innovation in Managing Care for High-Risk Seniors in Medicare+Choice Risk Plans

This case study of four well-regarded managed care organizations found that they made numerous innovations to improve care delivery for elderly Medicare beneficiaries with chronic illnesses and disabilities. Using the flexibility provided by capitation, they added new services in 1) screening to identify high-risk seniors, 2) care management and disease management, 3) network credentialing, 4) occasional provision of off-policy benefits, and 5) better coordination in the delivery of inpatient, subacute, and home health services. Yet these innovations were constrained by Medicare+Choice contracts and lack of clear evidence on the cost-saving potential of many services. At the same time, the case study organizations produced satisfaction levels among high-risk seniors that were substantially higher than those previously reported for Medicare beneficiaries facing high risks for adverse health outcomes. The study raises important issues about the potential of Medicare+Choice to enhance care for frail elders, at a time when the program is in jeopardy.