Health Care Use and Spending among Need-Based Subgroups of Medicare Beneficiaries with Full Medicaid Benefits

Abstract

Importance: Beneficiaries dual eligible for Medicare and Medicaid account for a disproportionate share of expenditures due to their complex care needs. Lack of coordination between payment programs creates misaligned incentives, resulting in higher costs, fragmented care, and poor health outcomes. Objective: To inform the design of integrated programs by describing the health care use and spending for need-based subgroups in North Carolina's full benefit, dual-eligible population. Design, Setting, and Participants: This cross-sectional study using Medicare and North Carolina Medicaid 100% claims data (2014-2017) linked at the individual level included Medicare beneficiaries with full North Carolina Medicaid benefits. Data were analyzed between 2021 and 2022. Exposure: Need-based subgroups: community well, home- and community-based services (HCBS) users, nursing home (NH) residents, and intensive behavioral health (BH) users. Measures: Medicare and Medicaid utilization and spending per person-year (PPY). Results: The cohort (n = 333240) comprised subgroups of community well (64.1%, n = 213667), HCBS users (15.0%, n = 50095), BH users (15.2%, n = 50509), and NH residents (7.5%, n = 24927). Overall, 61.1% reported female sex. The most common racial identities included Asian (1.8%), Black (36.1%), and White (58.7%). Combined spending for Medicare and Medicaid was $26874 PPY, and the funding of care was split evenly between Medicare and Medicaid. Among need-based subgroups, combined spending was lowest among community well at $19734 PPY with the lowest portion (38.5%) of spending contributed by Medicaid ($7605). Among NH residents, overall spending ($68359) was highest, and the highest portion of spending contributed by Medicaid (70.1%). Key components of spending among HCBS users' combined total of $40069 PPY were clinician services on carrier claims ($14523) and outpatient facility services ($9012). Conclusions and relevance: Federal and state policy makers and administrators are developing strategies to integrate Medicare- and Medicaid-funded health care services to provide better care to the people enrolled in both programs. Substantial use of both Medicare- and Medicaid-funded services was found across all need-based subgroups, and the services contributing a high proportion of the total spending differed across subgroups. The diversity of health care use suggests a tailored approach to integration strategies with comprehensive set benefits that comprises Medicare and Medicaid services, including long-term services and supports, BH, palliative care, and social services..