Medicare Advantage enrollment has doubled over the past decade, with about 45% of the Medicare population choosing Medicare Advantage, according to a new report by Better Medicare Alliance. Medicare Advantage is health insurance that offers Medicare benefits through a private sector health insurer.
The Better Medicare Alliance is a research and advocacy group that supports Medicare Advantage. The annual report compiles research and data about Medicare Advantage and its demographic and enrollment trends.
With about 45% of the Medicare population choosing Medicare Advantage over fee-for-service, the Better Medicare Alliance estimates that half of all Medicare-eligible beneficiaries will select Medicare Advantage by 2026.
Of Medicare Advantage enrollees, 33.7% identify as a racial or ethnic minority, compared to 16% in fee-for-service Medicare. Enrollment of minority beneficiaries in Medicare Advantage has increased 111% since 2013, according to the report.
More black and Latino Medicare beneficiaries are enrolled in Medicare Advantage: 53% of Latino beneficiaries, 49% of black beneficiaries, 34% of white beneficiaries and 31% of beneficiaries of other races.
Most Medicare Advantage enrollees choose Medicare Advantage prescription drug plans, at 90.8%. That includes your prescription drug coverage under one plan, according to the report.
According to the report, the increase in enrollment in Medicare Advantage plans was partially created by increased access to the plans. The number of plans offered has doubled in the past decade to 3,834 by 2022, and 99.7% of beneficiaries have access to at least one Medicare Advantage plan. In metropolitan areas, 99.9% of beneficiaries have access to at least one plan, compared to 98.4% of those in non-metropolitan areas.
Medicare Advantage plans are generally more affordable than fee-for-service plans, according to the report. Those with Medicare Advantage plans spend $1,965 less on out-of-pocket costs and premiums.
The average Medicare Advantage monthly premium is $19, a 15-year low and about 10% lower than the average Medicare Advantage premium in 2021, according to the report.
In addition, Medicare Advantage provides $32.5 billion in additional value to beneficiaries and the federal government each year. It does this by redistributing the savings from providing Medicare-covered benefits for less money, according to the report. It also covers all Medicare-covered benefits for 24% less than fee-for-service plans.
According to the report, of those enrolled in Medicare Advantage plans, 94% say they are satisfied with their coverage.
These beneficiaries have a 43% lower rate of avoidable hospitalizations for all conditions compared to those using fee-for-service. In 2020, during the Covid-19 pandemic, Medicare Advantage beneficiaries were hospitalized at a 19% lower rate and had a lower in-hospital mortality rate compared to beneficiary hospitalization rates of fee-for-service Medicare.
Medicare Advantage members also have a 21 percent higher rate of seeing a doctor within 14 days of hospital discharge, according to the report.
“With a 94% beneficiary satisfaction rate, annual consumer savings of nearly $2,000 per year, better health outcomes and lower government spending per beneficiary, Medicare Advantage has proven its value to both seniors and for the health care system,” said Mary Beth Donahue. president and CEO of the Better Medicare Alliance, said in a news release.
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