To examine the effects of the penetration of dual‐eligible special needs plans (D‐s) on health care spending.
Secondary state‐level panel data from Medicare‐Medicaid Linked Enrollee Analytic Data Source () public use file and Special Needs Plan Comprehensive Reports, Area Health Resource Files, and Medicaid Managed Care Enrollment Report between 2007 and 2011.
A difference‐in‐difference strategy that adjusts for dual‐eligibles’ demographic and socioeconomic characteristics, state health resources, beneficiaries’ health risk factors, Medicare/Medicaid enrollment, and state‐ and year‐fixed effects.
Data Sources/Study Setting
Data from were summarized from Centers for Medicare and Medicaid Services ()'s Chronic Conditions Data Warehouse, which contains 100 percent of Medicare enrollment data, claims for beneficiaries who are enrolled in the fee‐for‐service () program, and Medicaid Analytic Extract files. The public use file also includes payment information for managed care. Data in Special Needs Plan Comprehensive Reports were from 's Health Plan Management System.
Results indicate that D‐s penetration was associated with reduced Medicare spending per dual‐eligible beneficiary. Specifically, a 1 percent increase in D‐s penetration was associated with 0.2 percent reduction in Medicare spending per beneficiary. We found no association between D‐s penetration and Medicaid or total spending.
Involving Medicaid services in D‐s may be crucial to improve coordination between Medicare and Medicaid programs and control Medicaid spending among dual‐eligible beneficiaries. Starting from 2013, D‐s were mandated to have contracts with state Medicaid agencies. This change may introduce new effects of D‐s on health care spending. More research is needed to examine the impact of D‐s on dual‐eligible spending.
Data Collection/Extraction Methods