Each year during Medicare’s Open Enrollment Period, which runs from October 15 to December 7, individuals eligible for Medicare have the opportunity to adjust their healthcare coverage. This crucial period allows beneficiaries with traditional Medicare to evaluate and switch Medicare Part D stand-alone drug plans or enroll in a Medicare Advantage plan. For those already in Medicare Advantage, it’s a chance to compare and change Medicare Advantage plans or revert to traditional Medicare, potentially with or without a separate drug plan. In 2024, beneficiaries faced a wide array of choices, averaging around 43 Medicare Advantage plans and 21 stand-alone prescription drug plans (PDPs).
The Medicare private plan system is built upon the idea that beneficiaries will actively compare available plans during open enrollment. This comparison is essential for selecting coverage that best fits their unique health needs and financial situations. The costs and coverage details can significantly differ between Medicare Advantage and Part D plans and can change annually. Failing to review these options can lead to unexpected expenses and disruptions in healthcare access. For instance, changes in a Medicare Advantage plan’s provider network could restrict access to preferred doctors, while alterations in drug formularies and cost-sharing arrangements could increase out-of-pocket medication costs. Furthermore, health needs can evolve yearly. Even without plan modifications or health status changes, beneficiaries might discover plans that better suit their current needs or offer lower costs.
KFF focus groups have revealed that Medicare beneficiaries recognize factors like out-of-pocket expenses, access to specific physicians, and prescription drug coverage as vital in their Medicare choices. However, these same beneficiaries often express feeling overwhelmed by the complexity of comparing plans and the intense marketing, particularly for Medicare Advantage plans, which floods television and other media.
This analysis, based on the 2022 Medicare Current Beneficiary Survey (the most recent data available), investigates the proportion of Medicare beneficiaries who assessed their coverage and compared plans during the 2021 open enrollment for 2022 coverage. It also examines their utilization of official Medicare information resources and differences across various demographic groups.
Key Findings
- A significant majority, nearly 70% (69%), of Medicare beneficiaries did not compare their existing Medicare coverage with other available Medicare options in their area during the 2021 open enrollment period. Conversely, only 31% engaged in plan comparison. A higher percentage of beneficiaries in traditional Medicare opted not to compare plans compared to those in Medicare Advantage (73% vs. 65%).
- Among Medicare Advantage enrollees, over 40% (43%) did not review their current plan’s coverage for potential changes in premiums or other out-of-pocket costs. A similar proportion (44%) did not check for changes in covered treatments, drugs, and services for the upcoming year.
- The majority of enrollees in Medicare Advantage prescription drug plans (MA-PDs) and stand-alone prescription drug plans (PDPs) did not compare their drug coverage with other plans. Specifically, 82% of MA-PD enrollees and 69% of PDP enrollees did not compare drug coverage options.
- Medicare’s official informational resources, such as the 1-800 Medicare helpline, the Medicare website, and the Medicare & You handbook, are underutilized. Only about a quarter (26%) reported using the helpline, 42% visited the Medicare website, and slightly over half (54%) read parts of the Medicare & You handbook.
Most Medicare Beneficiaries Forego Comparing Medicare Coverage Options
Overall, the data reveals that most Medicare beneficiaries (69%) did not compare their current Medicare plan against other available options during the 2021 open enrollment period for 2022 coverage (Figure 1, Table 1). Even within Medicare Advantage, where plan changes like provider network adjustments or prior authorization requirements can greatly impact access to care, nearly two-thirds (65%) of enrollees did not compare coverage options for 2022.
The rate of non-comparison was higher among specific groups, including beneficiaries with lower incomes and education, Hispanic beneficiaries, those dually enrolled in Medicare and Medicaid, individuals under 65 with disabilities or aged 85 and older, and those with cognitive impairments (Figure 2, Appendix Table 1).
Significant Portion of Medicare Advantage Enrollees Miss Reviewing Their Existing Plan for Changes
Medicare Advantage plans can adjust premiums, cost sharing, and out-of-pocket limits annually, offering flexibility in modifying cost sharing for most services within certain limits. These plans often include supplemental benefits beyond traditional Medicare, but these benefits can change yearly. Furthermore, almost all Medicare Advantage plans require prior authorization for some services, and plan formularies and provider networks can also be altered annually, adhering to federal guidelines.
Over 40% (43%) of Medicare Advantage enrollees did not review their current plan during the open enrollment to identify potential changes in monthly premiums, deductibles, co-payments, or other out-of-pocket costs for 2022. However, 57% did undertake this review (Figure 3, Appendix Table 2). Similarly, 44% did not check for changes in the treatments, drugs, and services covered in their 2022 coverage.
The likelihood of not reviewing their plan for cost or service changes was higher among certain Medicare Advantage enrollees, including those with lower incomes and education, Black and Hispanic enrollees, those reporting fair or poor health, enrollees aged 85 and older, and those dually eligible for Medicare and Medicaid (Figure 3, Appendix Table 2).
For instance, half of Medicare Advantage enrollees in fair or poor health did not check for changes in premiums, deductibles, or co-payments, or for alterations in covered treatments, drugs, and services. Nearly two-thirds of Hispanic (65%) and half of Black (50%) Medicare Advantage enrollees did not review their plans for cost changes, with similar figures for service changes (64% vs. 48%, respectively). Additionally, almost 60% of adults aged 85 and older did not review their plan for changes in either costs (57%) or services (58%).
Most Medicare Beneficiaries with Part D Coverage Neglect Comparing Drug Coverage
Part D plan costs, including premiums, deductibles, and cost-sharing, are subject to annual changes and vary across plans. Formularies can also be modified, with drugs added or removed from coverage, and utilization management rules like prior authorization and step therapy can be implemented or altered.
The Inflation Reduction Act’s prescription drug provisions aim to reduce out-of-pocket drug costs for all Part D enrollees, including a new $2,000 cap on annual out-of-pocket spending starting in 2025. These significant changes may prompt Part D plan sponsors to adjust premiums, formularies, and cost-sharing, making it even more critical for beneficiaries to compare their prescription drug options during open enrollment.
Approximately 80% (82%) of enrollees in Medicare Advantage plans with prescription drug coverage (MA-PDs) did not compare their current MA-PD drug coverage with other MA-PD options in their area during the 2021 open enrollment (Figure 4; Appendix Table 3). Among stand-alone prescription drug plan (PDP) enrollees, a smaller proportion, 69%, did not compare their PDP drug coverage with other PDPs.
Non-comparison of drug coverage was more prevalent among women, beneficiaries with lower incomes and education, Hispanic beneficiaries, beneficiaries aged 85 and older, and dual-eligible individuals (Appendix Table 3).
Underutilization of Medicare’s Information Resources
Medicare offers several resources to help beneficiaries understand their benefits, coverage options, and costs, including the 1-800 Medicare helpline, Medicare.gov, and the Medicare & You handbook. However, these resources are not widely utilized, particularly the helpline (Figure 5, Appendix Table 4).
- About a quarter (26%) of Medicare beneficiaries used the 1-800-MEDICARE helpline for information. A significant 74% either never used the helpline (51%) or were unaware of its existence (23%).
- Around 40% (42%) visited the official Medicare website for information, while over half (58%) either never visited (36%) or lacked internet access or assistance (22%).
- Just over half (54%) reported reading some or all of the Medicare & You handbook, while 46% either did not read it (31%) or did not receive it or were unsure if they received it (15%).
Use of Medicare information sources was lower among specific groups, including Black beneficiaries, individuals aged 75 to 84, and dual-eligible individuals (Appendix Table 4).
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| Data for this analysis comes from the Centers for Medicare & Medicaid Services (CMS) 2022 Medicare Current Beneficiary Survey (MCBS). The analysis on plan comparison, Medicare Advantage plan review, and use of Medicare information resources utilizes data from the Medicare Plan Beneficiary Knowledge topical segment, weighted to represent the 2022 ever-enrolled Medicare population using the KNSEWT topical survey weight and relevant replicate weights. Beneficiaries newly enrolled in Medicare were excluded from the plan comparison and Medicare Advantage plan review analyses. The drug plan comparison analysis used data from the Rx Medication topical segment, similarly weighted using RXSEWT and relevant replicate weights, and excluded beneficiaries with only Part A or Part B, those with Medicare as secondary payer, and those in long-term care facilities. All reported differences are statistically significant at p<0.05. |
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