AHIP shares how enrollment in Medicare Supplement coverage has evolved

The share of Medicare fee-for-service beneficiaries with Medicare Supplement coverage grew from 35.4 percent in 2017 to 41.4 percent in 2022, an AHIP report found.

Medicare Supplement plans, also known as Medigap, are optional private health insurance coverage that can help seniors cover the costs that traditional Medicare does not cover. The report used the 2022 National Association of Insurance Commissioners (NAIC) data, 2022 California Department of Managed Health Care data, and 2021 Medicare Current Beneficiary Survey (MCBS) results to assess Medicare Supplement coverage options and enrollment trends.

The percentage of Medicare fee-for-service beneficiaries enrolled in Medicare Supplement coverage was 41.1 percent in 2022, up from 40.9 percent in 2021. However, national Medicare Supplement enrollment fell by 1.9 percent from 2021 to 2022 as Medicare fee-for-service enrollment declined. MCBS estimates indicate that 57 percent of all Medicare fee-for-service beneficiaries without additional coverage had Medicare Supplement coverage in 2021.

As of 2020, 56 percent of Medicare Supplement enrollees were women, 41 percent were 75 or older, and 24 percent lived in rural, non-metropolitan areas. Many beneficiaries with Medicare Supplement had low incomes; 8 percent had annual household incomes below $20,000 and 21 percent had incomes below $30,000.

Medicare beneficiaries with Medicare Supplement coverage were nearly three times less likely to have problems paying medical bills than beneficiaries without Medicare Supplement coverage (2 percent versus 6 percent).

As of December 2022, 9 percent of companies offering Medicare Supplement policies covered individuals in 41 or more states or territories. Twenty-two percent of companies covered people in 26 to 40 states or territories, 11 percent covered individuals in 11 to 25 states or territories, and 18 percent of companies covered people in two to ten states or territories.

In 2022, 85 companies offered Medicare SELECT policies, covering around 460,000 beneficiaries. These companies were located across 41 states.

Plan F (77 percent) and Plan G (75 percent) were the most commonly offered Medicare Supplement plans. The share of companies offering Plan N rose from 67 percent in 2021 to 68 percent in 2022. Meanwhile, the share of companies offering Plan A, Plan B, and Plan C continued to decrease.

Most Medicare Supplement policies were standardized plans (98.9 percent) and Plan F had the highest enrollment at 39 percent. However, the plan’s market share has been on a downward trend, falling from 49 percent in 2019. Plan G saw continued growth, rising from 22 percent of total enrollment in 2019 to 36 percent in 2022. AHIP predicted that Plan G may replace Plan F in the top enrollment spot over the next few years.

Plan F, Plan G, and Plan N accounted for 85 percent of total enrollment, while Plans E, H, I, L, and M comprised less than one percent of enrollment. Aside from Plan G, the only other plan that saw enrollment growth in 2022 was Plan A, which rose by 4 percent from 2021 to 2022.