More and more seniors are signing up for Medicare Advantage plans than ever before, according to a report by Kaiser Family Foundation (KFF) that looks at the most recent enrollment data from the Centers for Medicare and Medicaid Services.
In 2023, 50% of Medicare enrollees are in MA plans (also known as Part C plans), compared with just 19% in 2007. Meanwhile, average MA plan monthly premiums remain low, although the average premium paid increased 50% to $9 a month in 2023 from $6 the year prior, according to a second report, this one by <i>eHealth.com,</i> which tracked average costs for its customers.
That said, there are still many MA plans with zero premiums, but their popularity has declined with 84% of eHealth.com customers enrolled in these plans in 2023, compared to 87% in 2022.
MA plans are the private plan alternative to traditional Medicare. They cover Part A and Part benefits and will often include a Part D (drug benefit) plan for no additional premium. MA enrollees are still required to pay the Medicare Part B premium, which is $164.90 for the standard premium (for individuals who earn up to $97,000 a year).
Why does MA plan uptake continue growing? There are a number of reasons:
These plans may include additional benefits that traditional Medicare doesn’t cover, such as vision, hearing and dental services.
- MA plan enrollees have the potential to benefit from lower out-of-pocket costs compared to people in traditional Medicare.
- Enrollees often do not have to purchase a separate Part D prescription drug plan as these plans frequently include one.
- Many plans have zero premium.
- Unlike Original Medicare, MA plans have a yearly limit on what you pay out of pocket for services that Medicare Parts A and B cover. Once you reach your plan’s limit, you’ll pay nothing for services Parts A and B cover for the rest of the year.
Other considerations
Some of the major differences between MA and Original Medicare plans are:
- Unlike Original Medicare, in many cases, you can only use doctors and other providers who are in the plan’s network and service area (for non-emergency care). Some plans offer non-emergency coverage out of network, but typically at a higher cost.
- In many cases, and unlike Original Medicare, you may need to get approval from your plan before it covers certain drugs or services, which can affect access to care, according to the KFF report.
- MA plans generally don’t cover medical care outside the U.S. Some plans may offer a supplemental benefit that covers emergency and urgently needed services when traveling outside the country.
Studies have found that MA enrollees are generally satisfied with their plans. The eHealth.com report found that 89% of MA enrollees were satisfied with their coverage. Meanwhile, the “JD Power 2022 US Medicare Advantage Study” found that enrollee satisfaction with MA plans was 809 on a 1,000-point scale.
That said, KFF notes that other studies have found similar levels of satisfaction among Original Medicare recipients. If you are curious about these plans, are new to Medicare or are already enrolled, feel free to give us a call.
