UnitedHealth Group recently commissioned Milliman to analyze the value to the federal government of the Medicare Advantage (MA) program relative to Medicare fee-for-service (FFS). By law, coverage for MA services and cost sharing must be at least actuarially equivalent to what’s offered under Medicare FFS. After providing some general background on Medicare, we dive into the following topics:

• Government payments per-member-per-month for Medicare FFS versus MA
• Distribution of government payments to Medicare FFS versus MA 
• Additional MA benefits provided through Part C rebates 
• Total government and beneficiary costs for Medicare FFS versus MA 
• Choice and popularity
• Administrative costs

This report was commissioned by UnitedHealth Group.