Top 4 Medicare Advantage Penetration, Access Trends in 2023 Open Enrollment

Accessibility based on geography

The three states with the highest growth in the number of Medicare Advantage plans were spread across the US for the 2023 open enrollment season, located in the Midwest, the East Coast, and the South.

Texas gained 42 Medicare Advantage plans for plan year 2023. Florida’s Medicare Advantage plan options grew by 26 health plans. And in Pennsylvania, Medicare beneficiaries will have 21 more plan options.

However, 2023 open enrollment season has not been a story of growth for every state. Nine states and the District of Columbia will have fewer Medicare Advantage health plan options in 2023 than in 2022, losing anywhere from one to seven health plans. Washington state saw the biggest drop in the number of health plans, offering seven fewer plans in 2023 than in 2022.

Medicare Advantage remains more accessible for metropolitan residents than for non-metropolitan residents with an average of 46 health plans available to Medicare Advantage members in metropolitan areas, compared to 29 plans available to those in non-metropolitan areas. This is not new: Medicare Advantage beneficiaries in rural areas have been plagued by access to care issues.

Another trend that carried over from the 2022 open enrollment season is that Medicare Advantage plans continue to be most prevalent in Ohio and Pennsylvania. Ten counties in Ohio boast access to 80 Medicare Advantage plans or more in 2023., along with four counties in Pennsylvania.

Four percent of US counties offer beneficiaries access to three Medicare Advantage plans or fewer, with 40 counties offering zero Medicare Advantage plans. In 2022, 65 counties had zero access to Medicare Advantage coverage.

Accessibility based on plan type

For open enrollment 2023, Medicare Advantage health maintenance organizations (HMOs) are the most available option for many Medicare beneficiaries. Nearly six out of every ten Medicare Advantage plans are HMOs (58 percent). Historically, HMOs have been the most popular choice among Medicare beneficiaries during open enrollment.

While HMOs have held onto the majority, their share of the Medicare Advantage plan landscape has declined in recent years. Local preferred provider organizations (PPOs) are surging in availability, with four out of ten Medicare Advantage plans being categorized as local PPOs. This represents a leap of ten percent from the share of PPOs only four years prior in 2019.

In contrast, the number of regional PPOs and private fee-for-service health plans (PFFS) shrank in the 2023 open enrollment season from a meager two percent in 2019 to only one percent in 2023.

The number of special needs plans doubled between the 2018 to 2023 open enrollment seasons. In 2018, Medicare beneficiaries had access to a total of 630 special needs plans. In 2023, there will be 1,284 special needs plans, including plans that were for dual eligibles, chronic or disabling conditions, and institutional care.

Institutional care special needs plans have seen a particularly steep increase. Six out of ten special needs plans are for dual eligibles. Meanwhile, the number of chronic condition special needs plans has more than doubled since 2018.

Access to HMOs is more restricted for non-metropolitan areas, but the share is still high (91 percent). Local PPOs are also harder to find in non-metropolitan areas, with 93 percent of non-metropolitan counties having access to these types of plans. Regional PPOs are more common in non-metropolitan areas than in metropolitan areas.

Accessibility based on payer, firm, or sponsor

Diversity in payer penetration has not changed. On average, beneficiaries can choose from nine payers in 2023 for their Medicare Advantage plans, which is the same average as plan year 2022. Forty percent of beneficiaries in 300 counties can pick plans from 10 or more payers or sponsors. However, at the opposite end of the spectrum, there are 85 counties that will have plans from only one firm.

UnitedHealthcare and Humana are responsible for the largest share of Medicare Advantage health plans (46 percent combined). These two payers have dominated the Medicare Advantage markets in the past. In open enrollment 2021, UnitedHealthcare claimed more than a third of all net-new enrollees (36 percent) and Humana had the second-highest growth.

Every major payer expanded their footprint of counties in 2023 except for Kaiser Permanente. Humana will offer plans in the largest number of counties in 2023, expanding from 2,737 counties in 2022 to 2,860 counties in 2023. UnitedHealthcare increased the number of counties where it offered health plans from 2,377 in 2022 to 2,709 in 2023.

Accessibility based on star-rating

A dramatic shift occurred in the access to high-rated health plans trend, according to research from Avalere. Enrollment may shift once beneficiaries select their health plans for 2023, but if beneficiaries remain in their 2022 plan selections, they may see a significant decline in star-rating.

Avalere reported that in 2023 less than three-quarters of all Medicare Advantage Part D plan enrollees are in health plans with four or more stars. In contrast, the previous year 90 percent of enrollees were in Medicare Advantage Part D plans with four stars or more.

Moreover, enrollment in 5.0-star Medicare Advantage Part D plans dropped by five percentage points between plan year 2022 and 2023. Enrollment in 4.5-star plans and 4.0-star plans saw even steeper declines in enrollment.

The average star rating decreased from 4.37 stars in 2022 to 4.15 stars in 2023.