Medicare Advantage Enrollment Trend: The “Up” Continues

Medicare Advantage plans, once a relatively small part of the Medicare program, are fast becoming how the majority of Medicare beneficiaries are covered by the governmennt program.

In analysis published last week, the Kaiser Family Foundation found that almost half (48%) of Medicare beneficiaries are enrolled in Medicare Advantage plans, an 8% increase from 2021.

In absolute terms, that means 28.4 million people are enrolled in Medicare Advantage plans this year, according to the Kaiser tally.

Ten years ago, just over one-quarter (27%) of beneficiaries were in Medicare Advantage plans.

Related: Some Perils of Medicare Advantage Growing, Traditional Medicare Shrinking

There are many ideas about why Medicare Advantage enrollment is growing. The plans simplify matters for beneficiaries because they bundles Parts A, B, and D (which covers prescription drugs). Many plans also include vision, hearing and dental services. Some experts say the government has overpaid plans so they can afford to add coverage for vision, hearing and dental services that may make them appealing. The primary trade-off for the beneficiaries in a Medicare Advantage plan is that their coverage is mainly to hosptials and providers in their network.

The Kaiser Family Foundation researchers depended on CMS enrollment files and other sources to conduct their analysis.

Two-thirds (66%) of the people in Medicare Advantage signed up for coverage through an individual plan, according to the Kaiser researchers. Another 18% are in plans available through an employer or union and 16% are in Special Needs plans, most of whom are dually eligible for Medicare and Medicaid.

The states where the greatest proportion of Medicare beneficiaries are in Medicare Advantage plans are sprinkled around the country and don’t follow a red-blue state pattern. They include New Mexico (49%), Indiana (46%), Washington (46%), Idaho (45%), West Virginia (45%), South Carolina (41%), and New Jersey (41%), according to the Kaiser numbers. States with the lowest proportion of beneficiaries in Medicare Advantage plans are Wyoming (7%), North Dakota (9%), South Dakota (12%) and Alaska (1%).

The health insurers with the largest number of people in their Medicare Advantage plans are United Healthcare (7.9 million), Humana (5 million), the Blues plans collectively (4.1 million) and CVS Health (3.1 million).