The Vendorification of Medicare Advantage

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ID: 327964
2026
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Abstract
Abstract Medicare Advantage (MA) plans increasingly outsource core functions to third-party vendors, a trend termed the "vendorification" of MA. Vendors now play major roles in star-rating maximization, risk-code capture, and prior authorization, with evidence that vendor-conducted prior authorization yields higher denial rates and more appeal reversals than reviews conducted internally by insurers. This commentary examines three potential challenges that may be posed by vendorification: increased federal spending through non-budget-neutral risk adjustment and quality bonuses, opportunities to game medical loss ratio requirements, and weakened accountability to beneficiaries’ long-term health. Potential policy responses include mandatory reporting of vendor spending and, more fundamentally, reforming the payment incentives that make revenue-generating vendor services profitable.
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openalex_W7208819347 Use this key to autocite in the manuscript while using SciMatic Manuscript Manager or Thesis Manager
Authors David J. Meyers, Jeffrey Marr
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Journal Health Affairs Scholar
Year 2026
DOI
10.1093/haschl/qxag243
URL
https://academic.oup.com/healthaffairsscholar/advance-article-pdf/doi/10.1093/haschl/qxag243/70966397/qxag243.pdf
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