Use of High- and Low-Value Care Among Traditional Medicare Beneficiaries With and Without Medigap

To quantify the additional health care spending associated with Medigap coverage among traditional Medicare (TM) beneficiaries and assess whether this spending is disproportionately allocated to high-value versus low-value services.

We conducted a repeated cross-sectional study.

We analyzed TM beneficiaries with and without Medigap from the 2013-2021 Medical Expenditure Panel Survey. Inverse probability of treatment weighting (IPTW) was applied to balance observed covariates between TM beneficiaries with and without Medigap.

Our sample comprised 16,619 TM beneficiaries with and without Medigap. After applying IPTW, TM beneficiaries with and without Medigap were well balanced across observed covariates. TM beneficiaries with Medigap had $1062 (346-1779) higher annual Medicare spending than TM beneficiaries without Medigap. Higher spending among Medigap enrollees was primarily driven by outpatient visits ($453 [148-758]) and prescription drugs ($572 [223-921]). However, Medigap coverage was not consistently associated with greater use of either high-value or low-value services. Among high-value services, TM beneficiaries with Medigap had higher utilization of age-appropriate colorectal cancer screening (1.4 [0.7-2.0] percentage points) and influenza vaccination (1.5 [0.3-2.6]), but lower use of HbA1c measurement (-2.8 [-4.7, -1.0]). Among low-value services, TM beneficiaries with Medigap had greater use of prostate cancer screening (6.4 [0.5-12.2]) and nonsteroidal anti-inflammatory drug use for hypertension, heart failure, or kidney disease (3.2 [2.1-4.4]), but lower use of age-appropriate colorectal cancer screening (-4.2 [-5.1, -3.3]) and opioid prescriptions for back pain (-6.2 [-8.3, -4.2]). No significant differences were observed in the remaining services.

Medigap coverage is associated with higher health care spending among TM beneficiaries, but does not consistently promote high- or low-value care. These findings highlight the need for policy reforms that provide incentives to supplemental insurance plans to encourage evidence-based service use and discourage spending on unnecessary care.