New Research Finds Beneficiaries with Medicare Advantage Spend Less Than Those in Medicare Fee-for-Service

• Beneficiaries with Medicare Advantage (MA) typically receive better value and spend nearly 40 percent less than those in Medicare Fee-for-Service (FFS)
• Seniors enrolled in MA can save $50,000 to $85,000 over their lifetime
• MA plans provide additional, high-value services that reduce health care costs and improve outcomes

MINNETONKA, Minn.--(BUSINESS WIRE)--Beneficiaries enrolled in Medicare Advantage (MA) plans typically spend nearly 40 percent less than beneficiaries in Medicare Fee-for-Service (FFS) programs, according to new research released today by UnitedHealth Group (NYSE:UNH).

The research found that the average annual health care costs for a 72-year-old MA beneficiary of average health are $3,632, compared to up to $5,960 for Medicare FFS beneficiaries. Over their lifetime, seniors enrolled in Medicare Advantage can save $50,000 to $85,000.

Those savings and protections are especially important since half of Medicare beneficiaries live on fixed annual incomes below $27,000.

The Cost Difference between FFS and MA

A typical beneficiary enrolled in MA with Part D prescription drug coverage spends:

• $1,477 less than beneficiaries enrolled in FFS and Part D coverage;
• $1,809 less than beneficiaries who purchase Medigap Plan G as supplemental coverage for out-of-pocket costs; and
• $2,328 less than beneficiaries who purchase Medigap Plan F as supplemental coverage.

An average beneficiary who chooses an MA-PD plan pays between $1,265 and $1,918 less than a 65-year-old FFS beneficiary in average health. Choosing an MA-PD plan offers savings, regardless of age.

The Coverage Difference Between FFS and MA

Medicare Advantage plans offer all the same benefits as Medicare FFS, while including additional protections and benefits, not covered by Medicare FFS, that help beneficiaries stay healthy, improve care outcomes, and avoid unforeseen medical costs.

In addition to covering 6 percent more of the cost of hospital stays and physician office services than FFS, MA plans also include Part D prescription drug coverage, caps on annual out-of-pocket costs, and care management programs. Most plans also include dental, vision, and hearing coverage. MA beneficiaries with chronic conditions receive more preventative care and experience fewer emergency department visits and lower rates of avoidable hospitalizations compared to FFS beneficiaries.

Read more about the research at www.unitedhealthgroup.com.

About UnitedHealth Group

UnitedHealth Group (NYSE: UNH) is a diversified health care company dedicated to helping people live healthier lives and helping make the health system work better for everyone. UnitedHealth Group offers a broad spectrum of products and services through two distinct platforms: UnitedHealthcare, which provides health care coverage and benefits services; and Optum, which provides information and technology-enabled health services. For more information, visit UnitedHealth Group at www.unitedhealthgroup.com or follow @UnitedHealthGrp on Twitter.

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