Medicare Advantage: Déjà Vu All Over Again?

The Medicare Prescription Drug, Improvement, and Modernization Act (MMA) of 2003 expands the role of private health plans in Medicare through prescription drug plans and a revised Medicare+Choice (M+C), renamed Medicare Advantage, program. This paper discusses the factors responsible for the failure of M+C to develop as intended in 1997 and analyzes the challenges for MMA implementation in light of these factors. They include making a complex program understandable to beneficiaries; addressing plans' efforts to avoid enrolling high-cost beneficiaries; ensuring stability of benefits, providers, and plans; dealing with beneficiaries enrolled in unsuitable plans; providing equity of health benefits throughout the country; and controlling overall Medicare costs.