Medicare Advantage (MA) enrollment has been on a steady climb for the past two decades following changes in policy designed to encourage a robust role for private plan options in Medicare. In 2023, 30.8 million people are enrolled in a MA plan, accounting for more than half of the eligible Medicare population, and $454 billion of total federal Medicare spending. The average Medicare beneficiary in 2023 has access to 43 Medicare Advantage plans, the largest number of options ever.
MA Trends Across the Country
The share of Medicare beneficiaries enrolled in Medicare Advantage varies widely across counties. In 2023, nearly one third (31%) of Medicare beneficiaries live in a county where at least 60% of all Medicare beneficiaries are enrolled in MA plans, while 10% live in a county where less than one third of all Medicare beneficiaries are enrolled in MA plans. The variation in county enrollment rates could reflect several factors, such as differences in firm strategy, Medicare payment rates, number of Medicare beneficiaries, health care use patterns, and historical Medicare Advantage market penetration.
In addition, MA enrollment is concentrated among a small number of firms. UnitedHealthcare and Humana account for nearly half of all MA enrollees nationwide, and in nearly a third of counties (32%; or 1,013 counties), these two firms account for at least 75% of MA enrollment.
Opportunity to Provide Home-Centered Services
As care continues to move to the home and community, there is a clear opportunity for MA plans to provide home-centered services that are attractive to new members. Medicare Advantage trends in today’s market include offering non-medical services to make it easier for members to age in place, reducing friction around service coordination, and improving member touchpoints.
MA plans have long been able to offer “primarily health-related” supplemental benefits not covered by traditional fee-for-service Medicare, such as vision and dental coverage. These types of supplemental benefits have been an important differentiator among MA offerings, allowing people to identify plans that offer benefits and services that meet their needs.
MA Plans are Booming:
How Will You Stay Competitive?
Download our report “Home Benefits Surge in Popularity Among Medicare Advantage Plans” to learn more about leveraging supplemental benefits to increase member satisfaction, retention and STARs.
We found that progressive health plans are re-imagining how they work with providers and the organizations they contract with to make it easier to coordinate services and unlock a great member experience.
In our new report: Home Benefits Surge in Popularity Among Medicare Advantage Plans: Trends and Opportunities to Increase Member Satisfaction, Retention and Stars” we cover this and much more:
- The Meteoric Rise of Medicare Advantage
- 3 Medicare Advantage Trends in Supplemental Services
- Delivering on Supplemental Benefits
- Navigating Challenges in a Tight Labor Market
- What’s Next for Members?
3 Medicare Advantage Trends
The most exciting part about this growth and momentum is that more plans will use supplemental benefit programs to innovate and try new approaches that can move the needle on member wellness. Members have no shortage of options available to them and many plans are designing benefits tailored to specific communities or condition-specific populations, where they believe they can make the biggest impact.
Growth in Supplemental Benefits
Several trends have emerged from the evolving MA landscape. First, regulatory changes have expanded what MA plans can offer as supplemental benefits to include non-medical services such as transportation, meal delivery and home modification. As a result, the number of MA plans to offer at least one of the recently expanded supplemental benefits jumped 20% from 2022 to 2023.
According to KFF, since 2006, the role of MA has steadily grown. In 2022, more than 28 million people were enrolled in an MA plan, accounting for nearly half of the eligible Medicare population. This represents 55%, or a whopping $427 billion, of total federal Medicare spending.
Last year the average Medicare beneficiary had access to 39 MA plans, the largest number of options available in more than a decade.
Between 2021 and 2022, total MA enrollment grew by about 2.2 million beneficiaries, or 8% – a slightly slower growth rate than the prior year (10%). However, the Congressional Budget Office (CBO) projects that the share of all Medicare beneficiaries enrolled in MA plans will rise to 61% by 2032.
Anne Tumlinson, CEO of ATI Advisory, cites three trends. “First, is just the sheer growth in the amount of dollars being spent on supplemental benefits,” she said. Medicare per person spending on supplemental benefits has been growing, in part, due to investment in new categories of primarily health-related benefits and special supplemental benefits for the chronically ill.
IHSS is Fastest Growing Benefit
Second, is where that money is being spent. “Of all of the new, expanded benefits that are available for plans to offer above and beyond the traditional dental and vision, in-home support services (IHSS) is among the fastest growing in terms of the number of plans offering it. I have to say I would not have predicted this four years ago,” Tumlinson said.
In-home benefits are provided by health plans to address gaps in the traditional healthcare system. These benefits are often offered as part of a flexible package designed to support individual member needs and overall health. In addition to meeting those needs, many plans find that these benefits promote satisfaction and retention among their members.
ATI Advisory research shows that large health plans have rapidly expanded their in-home services coverage. Smaller plans that have never offered such services have begun doing so. Since 2020, there has been a 364% increase in plans offering IHSS, from 283 plans then to 1,314 in 2023. There has been a 320% increase in caregiver support service offerings, from 134 plans to 563 plans.
There has also been a 1,215% increase in plans offering social needs benefits, from 34 plans in 2020 to 563 now. All of these supplemental benefits are ones that home care providers could theoretically fulfill.
As more plans see the need for these benefits, there is also some flexibility emerging in how–and how often–members can use them. They also found that plans view these benefits as key for the satisfaction and retention of members.
Focus on Family Caregivers
Third, is a focus on family caregivers, which is the primarily health-related benefit category that grew the fastest from 2022 to 2023. Support for caregivers of enrollees more than tripled from 2021 to 2023.
The U.S. Department of Health and Human Services (HHS) estimates that around 53 million people provide some sort of assistance every year to a person close to them as they age, or due to a disability or chronic health condition. This takes on renewed importance as widespread workforce shortages continue to challenge the healthcare industry, including home and community-based service providers. Building caregiving capacity and determining who has availability so that members can access benefits in a timely manner is a growing problem that isn’t going away any time soon.
The solution to attracting and retaining this sector requires more than just rethinking traditional workforce and business models. Part of the solution needs to be to provide better support to frontline caregivers.
In response, HHS introduced its first ever national strategy plan to support family caregivers. The 2022 National Strategy to Support Family Caregivers plan lays out nearly 350 actions the federal government needs to take in order to make the lives of family caregivers easier as more adults choose to age at home. The goal is to address resource opportunities for the health, well-being and financial security for family caregivers.
And earlier this year, a group of lawmakers recently introduced the Supporting Our Direct Care Workforce and Family Caregivers Act that not only focuses on improving conditions for professional caregivers, but family caregivers as well. The introduction of this legislation is an acknowledgement that professional and family caregivers require federal investment.
If passed, the bill would provide grants to states and other relevant entities for initiatives that are meant to strengthen, educate and retain the caregiver workforce. On the family caregiver side, the bill also calls for the creation of grants aimed at providing educational and training support for these individuals.
Improving Supplemental Benefit Delivery
Industry experts say it’s not enough to offer great benefits; you also have to offer ease of access. According to a report from McKinsey, developing the right product and network design is a great start to getting members into a plan, but a significant investment in raising consumer awareness and optimizing the distribution strategy is also required. Many progressive health plans have taken three key steps to improve delivery:
- Reduce the friction around payment. Creating a debit card, or sending members a points card that they can use when they’re working with in-network providers, puts the consumer in charge.
- Make everything as flexible as possible, potentially offering access to services like food, in-home support services, or non-medical transportation in different kinds of combinations and packages.
- Lastly, there’s no substitute for the ability to easily contact a live person for support if there are questions about the services being activated and delivered.
Unlocking New Supplemental Benefits
Navigating the healthcare system is challenging, not just for members, but also for the care coordinators who support them. Care coordinators are faced with the daunting task of managing a wide range of benefits and services, all while trying to ensure that members get the best possible care. Members are frustrated when they don’t know where their benefits are or how to access different services.
“I think plans are doing an incredible job of being aware of what their membership wants, whether it’s food, transport, or in-home services, but to really deliver that five-star experience, we’re seeing leading organizations invest in their culture,” said Ashish V. Shah, Dina CEO. “We’re seeing organizations double down on their staff–making sure that they’ve got the right tools, that they’re happy, and it then spills over into their touch points with members.”
Beyond member touchpoints, organizations are re-imagining how they work with providers to make it easier for them to unlock a really great experience.
People have choices when it comes to what kind of healthcare they want, how and where they access it, and which insurance plan is the best fit. The challenge is to build a culture and infrastructure that focuses on caring for them as people.
In response, plans are becoming innovative in how they unlock new benefits to meet people where they are on their journey to help them live their very best life.
Over the last decade, Medicare Advantage, the private plan alternative to traditional Medicare, has taken on a more prominent role in the Medicare program. In 2023, more than half of the eligible Medicare population are enrolled in a Medicare Advantage plan. Members have no shortage of options available to them and they will shop around for the plan that delivers the benefits that best meet their needs, particularly if they require multiple services to age in place or manage chronic conditions. How does your plan stack up to your competitors? Download our report to find out how you can use supplemental benefit programs to improve member satisfaction, increase member retention, and boost. your Star ratings.
MA Plans are Booming:
How Will You Stay Competitive?
Download our report “Home Benefits Surge in Popularity Among Medicare Advantage Plans” to learn more about leveraging supplemental benefits to increase member satisfaction, retention and STARs.
