Each year, during Medicare’s Open Enrollment from October 15 to December 7, beneficiaries have the opportunity to evaluate their healthcare coverage and make changes. This period is crucial for those with traditional Medicare and Medicare Advantage (MA) plans alike. With an average Medicare beneficiary facing a choice of around 43 Medicare Advantage plans and 21 standalone Part D drug plans in 2024, the marketplace is rich with options. However, navigating this complex landscape requires a proactive approach to Medicare Advantage Compare and plan selection.
The core principle of the Medicare private plan market is that beneficiaries actively compare plans to find the best fit for their unique health needs and financial situations. Coverage details and costs can fluctuate significantly between Medicare Advantage plans and Part D prescription drug plans, and these changes can occur annually. Failing to compare Medicare Advantage options can lead to unexpected expenses and disruptions in healthcare access. For instance, shifts in Medicare Advantage provider networks could restrict access to preferred doctors, while modifications in drug formularies and cost-sharing structures might elevate out-of-pocket medication costs. Furthermore, healthcare needs evolve; even without plan alterations or health status changes, beneficiaries might discover plans that better align with their current requirements or offer reduced out-of-pocket expenses if they take the time to compare Medicare Advantage plans.
KFF’s focus groups with Medicare beneficiaries underscore these considerations. Participants highlighted out-of-pocket costs, access to specific healthcare providers, and prescription drug coverage as pivotal factors in their Medicare coverage decisions. However, these beneficiaries also voiced challenges in understanding and comparing the array of plan options, often feeling overwhelmed by the intense marketing, particularly for Medicare Advantage plans. This barrage of advertising can sometimes overshadow the importance of a thorough Medicare Advantage compare process.
This analysis delves into 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 variations across demographic groups. The findings are based on data from the 2022 Medicare Current Beneficiary Survey (MCBS), the most recent data available, and aim to emphasize the necessity of Medicare Advantage compare for all beneficiaries.
Key Findings on Medicare Plan Comparison
- A significant majority, nearly 7 in 10 (69%), of Medicare beneficiaries did not engage in Medicare Advantage compare or assess other Medicare options available in their area during the 2021 open enrollment period. Conversely, only 31% undertook a comparison. A higher percentage of beneficiaries with traditional Medicare, compared to those in Medicare Advantage, did not compare their coverage (73% versus 65%).
- Among Medicare Advantage enrollees, over 4 in 10 (43%) did not review their existing plan’s coverage for potential changes in premiums or other out-of-pocket costs. The remaining 57% did conduct such a review. Similarly, 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) (82%) and standalone prescription drug plans (PDPs) (69%) did not compare their plan’s drug coverage against other plans in their area.
- Medicare’s official information resources, including the 1-800 Medicare helpline, the Medicare website, and the Medicare & You handbook, are underutilized. Only a quarter (26%) reported using the helpline, 42% visited the Medicare website, and slightly over half (54%) read parts of the Medicare & You handbook.
The Low Rate of Medicare Advantage Compare During Open Enrollment
Overall, a substantial 69% of Medicare beneficiaries reported not comparing their current Medicare plan against other available Medicare coverage options during the 2021 open enrollment period for 2022 coverage (Figure 1, Table 1). Even among Medicare Advantage enrollees, nearly two-thirds (65%) did not compare coverage options for 2022. This is despite the fact that annual changes in Medicare Advantage plans, such as alterations to provider networks or prior authorization requirements, can significantly impact beneficiaries’ access to care. This lack of Medicare Advantage compare is a critical issue, potentially leaving many beneficiaries in suboptimal plans.
Figure 1: Bar chart showing that 69% of Medicare beneficiaries did not compare Medicare coverage options during the 2021 open enrollment period for coverage in 2022, while 31% did compare.
The propensity to not compare Medicare coverage arrangements was more pronounced among specific demographic groups. These include beneficiaries with lower incomes and education levels, Hispanic beneficiaries, those dually enrolled in Medicare and Medicaid, individuals under 65 with disabilities or aged 85 and older, and beneficiaries with cognitive impairments (Figure 2, Appendix Table 1). These vulnerable populations may face additional barriers to accessing and understanding information necessary for Medicare Advantage compare and plan selection.
Figure 2: Stacked bar chart illustrating the percentage of Medicare beneficiaries who did not compare Medicare coverage options during the 2021 open enrollment period, broken down by demographic groups including income, education, race/ethnicity, dual enrollment status, age group, and cognitive impairment.
Inadequate Review of Existing Medicare Advantage Plans for Changes
For those enrolled in Medicare Advantage, premiums, cost-sharing, and out-of-pocket limits are subject to annual variations and differ across plans. Medicare Advantage plans possess the flexibility to adjust cost-sharing for most services, within certain regulatory boundaries. While these plans can offer supplemental benefits beyond traditional Medicare, the nature and extent of these benefits can change yearly. Furthermore, prior authorization requirements are prevalent in nearly all Medicare Advantage plans, and these plans can modify their drug formularies and provider networks annually, adhering to federal standards. Therefore, a regular Medicare Advantage compare process should include a review of one’s existing plan.
More than 4 in 10 (43%) Medicare Advantage enrollees did not review their current plan during the open enrollment period to identify potential changes for 2022 in monthly premiums, deductibles, co-payments, or other out-of-pocket expenses. However, a slight majority (57%) did undertake this review (Figure 3, Appendix Table 2). Similarly, 44% of Medicare Advantage enrollees did not check their current plan for changes in covered treatments, drugs, and services for 2022 coverage. This indicates a significant portion of MA enrollees are not proactively engaging in Medicare Advantage compare to understand potential changes in their existing coverage.
Figure 3: Dual bar chart comparing the percentage of Medicare Advantage enrollees who did not review their current plan for potential changes in costs versus changes in services for 2022; approximately 43-44% did not review for either category.
The rate of non-review of existing plans for cost or service changes was higher among specific Medicare Advantage enrollees, including those with lower incomes and education levels, Black and Hispanic enrollees, individuals in 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 reporting fair or poor health did not verify potential changes in premiums, deductibles, or co-payments, or in the treatments, drugs, and services covered. 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% and 48%, respectively). Additionally, almost 60% of adults aged 85 and older did not review their plans for changes in costs (57%) or services (58%). These disparities highlight the need for targeted outreach and support to encourage Medicare Advantage compare among these groups.
Lack of Comparison of Part D Prescription Drug Coverage
Part D plan costs, encompassing premiums, deductibles, and cost-sharing, can fluctuate annually and vary across plans. Furthermore, Part D plans can modify their formularies, which includes adding or removing drugs from coverage and adjusting utilization management protocols like prior authorization and step therapy. Given these potential changes, Medicare Advantage compare should also extend to prescription drug coverage.
The Inflation Reduction Act’s prescription drug provisions aim to lower out-of-pocket costs for all Part D enrollees, including a $2,000 cap on annual out-of-pocket spending starting in 2025. Anticipating these changes, Part D plan sponsors might adjust premiums, formularies, and cost-sharing, making it even more vital for beneficiaries to compare their prescription drug options during open enrollment and engage in a thorough Medicare Advantage compare process if their MA plan includes drug coverage.
Approximately 8 in 10 (82%) enrollees in Medicare Advantage plans with prescription drug coverage (MA-PDs) did not compare the drug coverage of their MA-PD to other MA-PDs in their area during the 2021 open enrollment period (Figure 4; Appendix Table 3). Among standalone prescription drug plan (PDP) enrollees, a smaller proportion, 69%, reported not comparing their current PDP’s drug coverage to other PDPs. This widespread lack of Medicare Advantage compare for drug coverage can lead to beneficiaries overpaying for medications or not having optimal access to needed drugs.
Figure 4: Dual bar chart showing the percentage of beneficiaries with Medicare Advantage Prescription Drug Plans (MA-PD) and Standalone Prescription Drug Plans (PDP) who did not compare their drug coverage options in 2021; MA-PD non-comparison is significantly higher at 82% versus 69% for PDP.
The percentage of beneficiaries with MA-PD or PDP coverage who did not compare drug coverage for 2022 was higher among women, beneficiaries with lower incomes and education levels, Hispanic beneficiaries, beneficiaries aged 85 and older, and dual-eligible individuals (Appendix Table 3). These findings reinforce the pattern observed in overall plan comparison and MA plan review, indicating consistent disparities in Medicare Advantage compare behavior across various demographic groups.
Underutilization of Medicare’s Information Resources
Medicare offers various resources to aid beneficiaries in understanding their benefits, coverage options, and costs. These include the 1-800 Medicare toll-free number, the Medicare.gov website, and the annual Medicare & You handbook. However, these resources are not widely used, particularly the toll-free number (Figure 5, Appendix Table 4). This underutilization represents a missed opportunity to facilitate informed Medicare Advantage compare and plan selection.
- Approximately a quarter (26%) of Medicare beneficiaries reported contacting the 1-800-MEDICARE helpline for information. A large majority (74%) either never called (51%) or were unaware of its existence (23%).
- Four in 10 (42%) Medicare beneficiaries (or someone on their behalf) visited the official Medicare website for information. Over half (58%) either never visited (36%) or lacked internet access or assistance (22%).
- Slightly more than half (54%) of Medicare beneficiaries reported reading the Medicare & You handbook (either thoroughly or partially). However, 46% either did not read it (31%) or did not receive it or were unsure if they received it (15%).
Figure 5: Triple bar chart depicting the use of Medicare information resources among all beneficiaries; the bars represent the percentage who used the Medicare Handbook, Medicare Website, and 1-800-MEDICARE helpline, with handbook usage highest and helpline usage lowest.
The utilization of Medicare information resources was lower among specific subgroups, including Black beneficiaries, individuals aged 75 to 84, and dual-eligible individuals (Appendix Table 4). This suggests that those who might benefit most from assistance with Medicare Advantage compare are less likely to access available resources.
Conclusion: The Urgent Need to Promote Medicare Advantage Compare
The data clearly indicates a significant gap between the ideal of informed consumer choice in the Medicare market and the reality of beneficiary behavior. A large proportion of Medicare beneficiaries are not actively engaging in Medicare Advantage compare or reviewing their existing coverage, potentially leading to suboptimal healthcare choices and unnecessary costs. This issue is particularly pronounced among vulnerable populations who may face systemic barriers to accessing and understanding plan information.
Efforts to improve Medicare beneficiary outcomes should prioritize strategies to encourage and facilitate Medicare Advantage compare. This includes:
- Enhanced Education and Outreach: Targeted educational campaigns, particularly for underserved communities, are needed to emphasize the importance of annual plan comparison and to promote the use of available Medicare resources.
- Simplifying Information: Medicare plan information can be complex and overwhelming. Efforts to simplify plan materials and comparison tools are crucial to improve beneficiary understanding and engagement in Medicare Advantage compare.
- Leveraging Technology: Improving the accessibility and user-friendliness of online Medicare plan comparison tools and resources can make it easier for beneficiaries to compare plans effectively.
- Trusted Intermediaries: Supporting and promoting the role of trusted counselors and navigators who can assist beneficiaries with Medicare Advantage compare and plan selection is essential.
By addressing these challenges and promoting proactive Medicare Advantage compare behavior, we can empower beneficiaries to make informed decisions that optimize their healthcare coverage and financial well-being.
Methods
This analysis is based on survey data from the Centers for Medicare & Medicaid Services (CMS) Medicare Current Beneficiary Survey (MCBS) 2022 Survey File, focusing on community-dwelling Medicare beneficiaries. The analysis of plan comparison rates, Medicare Advantage plan review, and use of Medicare information resources utilized questions from the Medicare Plan Beneficiary Knowledge topical segment. Data were weighted to represent the ever-enrolled Medicare population in 2022 using the topical survey weight KNSEWT and relevant replicate weights. Beneficiaries who reported just enrolling in Medicare were excluded from the analysis of plan comparison and MA plan review. The analysis of MA-PD/PDP drug plan comparison used questions from the Rx Medication topical segment, weighted similarly using RXSEWT and replicate weights. Beneficiaries with Part A or Part B only, those with Medicare as secondary payer, and those in long-term care facilities were excluded from both analyses. All reported differences are statistically significant at p<0.05.
Appendix
Topics
- Medicare
Tags
- Medicare Advantage
- Medicare Open Enrollment
- Medicare Part D
- Medicare Beneficiaries
- Prescription Drugs
