People on Medicare Report Significantly Better Coverage than Those with Private Health Insurance, Study Finds

Medicare Provides Better Coverage, Access to Care and Quality of Care than Private Insurance, New Survey FindsA recent study published in the journal HealthAffairs found that people on Medicare were substantially happier with their coverage and reported significantly fewer cost and access-related problems than those with private employer-sponsored health insurance or “Medicare Advantage” plans offered by private insurance companies.

The study, based on a national survey by researchers at the nonprofit Commonwealth Fund in New York City, found that only 8 percent of Medicare beneficiaries age 65 or over rated their coverage “fair” or “poor,” while 20 percent of people with employer-based private insurance coverage gave their insurance plan low marks, and fully 33% of people who bought insurance on their own from private insurance companies in the individual market reported unhappiness with their coverage.

“This article provides evidence that people with employer-sponsored coverage were more likely than Medicare beneficiaries to forgo needed care, experience access problems due to cost, encounter medical bill problems, and be less satisfied with their coverage,” the study authors reported.

As summarized by the Health Affairs Blog, the research “found that those in the [traditional] Medicare group were more satisfied with their insurance, less likely to report cost- or access-related problems, and more likely to report receiving excellent quality of care,” than nonelderly adults covered by private insurance.

In addition, the researchers found that seniors enrolled in the traditional Medicare program were significantly happier with their coverage and spent less out-of-pocket than their peers who chose private Medicare Advantage plans. People age 65 or older who were enrolled in the private ‘Medicare Advantage’ program were “more likely than those in traditional Medicare to rate their insurance poorly and to report cost-related access problems,” the authors reported.

“These results suggest that policy options to shift Medicare beneficiaries into private insurance would need to be attentive to potentially negative insurance experiences, problems obtaining needed care, and difficulties paying medical bills,” the study authors concluded.

The study, “Medicare Beneficiaries Less Likely To Experience Cost- And Access-Related Problems Than Adults With Private Coverage,” appeared in the July issue of the journal Health Affairs.

According to an article in the National Journal, as reported by Kaiser Health News, “The study found that traditional Medicare costs less not just for the government but for beneficiaries, data that is sure to emerge in the next discussions about whether Medicare should be converted from a government-run insurance program to a private voucher system, a proposal championed by congressional Republicans [led by House Budget Committee Chairman Paul Ryan (R-Wis.)] and GOP presidential hopeful Mitt Romney.”

The Study; Method

Researchers at the nonprofit Commonwealth Fund, led by Karen Davis, President of the Commonwealth Fund, conducted a nationwide telephone survey of adults 19 years old or older. The researchers interviewed 3,033 adults under the age of 65 and 940 adults age 65 and older. The interviews took place between July and November of 2010.

The interview questions focused on the participants’ experiences with their health care coverage, including access to care, coverage, quality of care, cost, and satisfaction with their insurance coverage and care.

Ms. Davis and her Commonwealth Fund colleagues compared the results for Medicare beneficiaries to those for younger adults covered by private insurance – both employer-sponsored plans and individually purchased plans. The researchers also reviewed the differences in experiences reported by those with traditional Medicare versus those with “Medicare Advantage” plans provided by private insurance companies.


As reported by the Health Affairs Blog, key findings of the study included the following:

    Degree of Satisfaction with Health Care Coverage – Medicare vs. Private Insurance:

  • “Eight percent of Medicare beneficiaries rated their insurance as fair or poor compared to 20 percent of nonelderly adults with employer insurance and 33 percent purchasing insurance on the individual market.”
  • “Among Medicare beneficiaries, only 6 percent of those with traditional Medicare gave a fair or poor rating, compared to 15 percent of Medicare Advantage beneficiaries.”
  • Problems with Access to Care – Medicare vs. Private Insurance:

  • “Thirty-seven percent of working adults with employer-sponsored coverage reported at least one access problem due to cost, compared to 23 percent of elderly adults with Medicare.”
  • “Among Medicare beneficiaries, those with traditional plans were significantly less likely to report problems accessing care than those opting for Medicare Advantage (23 percent versus 32 percent).
  • “In describing access to a primary provider, 64 percent of Medicare beneficiaries and 51 percent of those with employer-based insurance said they had a regular doctor or place of care; only 26 percent of those without insurance claimed this degree of access to care.”
  • Costs – Medicare vs. Private Insurance:

  • “For those with employer insurance, 27 percent reported difficulties paying bills, compared to 13 percent of Medicare beneficiaries.”
  • Quality of Care – Medicare vs. Private Insurance:

  • “Just one-quarter (25 percent) of adults with employer-sponsored coverage reported receiving excellent quality of care, compared to 37 percent of elderly Medicare beneficiaries. Those with individual [insurance plans] (17 percent) and no health insurance (12 percent) reported receiving excellent care at the lowest rates.”

Thus, it appears that on every measure – overall satisfaction of beneficiaries, access to care of choice, costs, and quality of care – Medicare did better than health insurance plans provided by private insurance companies.

Conclusions; Implications

“The evidence reported here…shows that Medicare is doing a better job than employer-sponsored plans at fulfilling the two main purposes of health insurance: ensuring access to care and providing financial protection,” the study authors concluded.

“In the policy debates over the federal budget deficit, the affordability of Medicare, and the expansion of health insurance through the Affordable Care Act, it is important to listen to what people have to say about being covered by Medicare or private employer insurance,” the authors wrote.

These findings of the Commonwealth Fund study have been made especially relevant by Presidential Candidate Mitt Romney’s pick of Paul Ryan as his running mate.

As reported by the Los Angeles Times, “Republicans, including former Massachusetts Gov. Mitt Romney, the presumptive GOP presidential nominee, [who has now underscored his support of the Ryan Budget Plan by picking House Budget Committee Chairman Paul Ryan (R-Wis.) as his running mate,] want to convert Medicare into a what they call a “premium support” program that gives beneficiaries vouchers to buy a private insurance plan of their choosing.”

“Choice and competition remain the only means by which costs can be brought under control without sacrificing quality,” Rep. Paul Ryan said in a recent interview with the conservative newspaper Human Events.

As reported by the Los Angeles Times, “Ryan called President Obama’s plan to make the current government-guaranteed program more efficient and to improve the quality of medical care that it pays for ‘a recipe for government rationing.’”

However, the findings of the Commonwealth Fund national survey show that Americans on Medicare feel they have much better access to medical care, quality of care, and coverage, as well as lower costs, than do Americans who rely on private insurance coverage.

“There are a lot of myths out there,” Commonwealth Fund president Karen Davis, lead author of the new study told the Los Angeles Times. “It is important to remember how well Medicare performs.”

“The survey results suggest that simply shifting more beneficiaries into private plans could leave them at increased risk for negative insurance experiences, problems obtaining needed care and difficulties with medical bills,” the study’s authors wrote.

More Information

See related HelpingYouCare™ reports on:

No Increase in Medicare Prescription Drug Premium for 2013 – Third Straight Year of No Increase – HHS Announces

Affordable Care Act Has Saved $3.9 Billion on Prescription Drugs for Those on Medicare, CMS Announces

Over 16 Million Seniors on Medicare received Free Preventive Care under Affordable Care Act in 2012, HHS Announces

86 Million Americans Benefited from Free Preventive Healthcare Coverage in 2011 Due to Affordable Care Act, HHS Reports

Medicare Announces Premiums & Deductibles for 2012

For more information on Medicare, private health insurance, and financial and legal issues for seniors and their family caregivers, see the HelpingYouCare™ resource pages on Legal and Financial Issues for Seniors & Caregivers, including:


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