More Medicare beneficiaries did an about-face between 2017 and 2020 and switched from traditional Medicare plans to Medicare Advantage (MA) plans, according to a recent study published in JAMA Health Forum.
The study found that in 2016 more Medicare enrollees migrated from MA plans to traditional fee-for-service Medicare plans. However, between 2017 and 2020 the trend reversed with more enrollees moving from traditional plans to MA plans — at roughly four times the rate. Transferring accounted for a growing share of new MA enrollment growth, increasing from 49% in 2016 to 67% in 2020.
The study found that Black and Hispanic beneficiaries switched at greater rates than whites, with the departure from traditional Medicare plans to MA plans being more pronounced among those two groups. Black and Hispanic beneficiaries were also twice as likely to disenroll from traditional plans as whites. The study found the switching trends among beneficiaries continued during the last year of life.
The study’s authors attribute switching to possible changes in the health status of beneficiaries, cost considerations, access to specialized healthcare clinicians and the inclusion of additional services in MA plans. In recent years, MA plans have been adding non-medical supplemental benefits, including home care, meals, transportation and handyman services. The number of MA plans offering supplemental benefits doubled between 2021 and 2022 and will increase another 40% this year, according to ATI Advisory.
The study did not estimate the individual effects or relationship between beneficiary characteristics and switching behavior. The authors said future work exploring associations is warranted.
Enrollment in MA plans has been growing. The Kaiser Family Foundation recently estimated approximately 48% of Medicare beneficiaries are enrolled in the plans, with enrollment expected to eclipse that of traditional fee-for-service plans within the next few years.
MA plans have been coming under increased scrutiny in the past year. Last spring, the Office of Inspector General accused MA plans of denying or delaying services to beneficiaries covered under Medicare rules. Last month, the Centers for Medicare & Medicaid Services proposed a rule that would protect consumers from misleading MA marketing.
