Continuous Insurance before Enrollment Associated with Better Health and Lower Program Spending

Gao.gov: 12/1/13

Beneficiaries with continuous health insurance coverage for approximately 6 years before enrolling in Medicare were more likely than those without prior continuous insurance to report being in good health or better during the first 6 years in Medicare. In particular, having prior continuous insurance raised the predicted probability that a beneficiary reported being in good health or better by nearly 6 percentage points during the first 6 years in Medicare.

Beneficiaries with prior continuous insurance had lower total program spending during the first year in Medicare compared with those without prior continuous insurance. Specifically, during the first year in Medicare, beneficiaries with prior continuous insurance had approximately $2,300, or 35 percent, less in average predicted total spending than those without prior continuous insurance. Similarly, beneficiaries with prior continuous insurance had lower institutional outpatient spending—for example, spending for services provided in a hospital outpatient setting—during the first and second years in Medicare compared with those without prior continuous insurance. In contrast, physician and other noninstitutional spending—spending for services provided by physicians, clinical laboratories, free-standing ambulatory surgical centers, and other noninstitutional providers—were similar during the early years in Medicare for beneficiaries with and without prior continuous insurance. However, during the fourth and fifth years in Medicare, beneficiaries with prior continuous insurance had physician and other noninstitutional spending that was about 30 percent higher than beneficiaries without prior continuous insurance.  Read More