Making capitated Medicare work for women: Policy and research challenges

Growth in capitated Medicare has special ramifications for older women who comprise the majority of Medicare beneficiaries. Older women are more likely than men to have chronic conditions that lead to illness and disability, and they often have fewer financial and social resources to cope with these problems. Gender differences in health status have a number of important implications for the financing and delivery of care for older women under both traditional fee-for-service Medicare and capitation. The utilization of effective preventive interventions, new therapeutic interventions for the management of common chronic disorders, and more cost-effective models of chronic disease management could potentially extend the active life expectancy of older women. However, there are financial and delivery system barriers to achieving these objectives. Traditional FFS Medicare has gaps in coverage of care for chronic illness and disability that disproportionately impact women. Managed care potentially offers flexibility to allocate resources creatively, to develop new models of care, and offer enhanced benefits with lower out-of-pocket costs. However, challenges to realizing this potential under Medicare managed care with unique implications for older women include: possible gender bias in capitation payments, risk selection, inadequacy of risk adjustment models, benefit and market instability, and disenrollment patterns.