Medicare Advantage Plans See High Enrollment, Low Spending in 2022

Medicare Advantage plans are seeing low healthcare spending, strong diversity, and high enrollment in 2022 compared to 2021 and earlier years, according to the Better Medicare Alliance’s 2022 State of Medicare Advantage report.

“With a 94% beneficiary satisfaction rate, annual consumer savings of nearly $2,000 per year, better health outcomes, and lower per-beneficiary government spending, Medicare Advantage has proven its value to seniors and the health care system alike,” Mary Beth Donahue, president and chief executive officer of the Better Medicare Alliance said in the press release.

“More than just facts and figures on a page, this report is a testament to what policymakers and advocates can do when they put beneficiaries first – and what can still be achieved by protecting and strengthening this well-working health care success story.”

The report highlighted key statistics in four areas: enrollment, access, affordability, and outcomes.

Medicare Advantage enrollment has boomed in recent years and, with it, the diversity of the beneficiary population. 

Seniors represented 16.5 percent of the population in 2021. Out of the entire Medicare population, 46.2 percent were enrolled in Medicare Advantage in 2022, compared to 43.1 percent in 2021. 

A little more than a third of Medicare Advantage beneficiaries in 2021 (33.7 percent) identified themselves as part of a racial or ethnic minority, more than double the percentage of beneficiaries in original Medicare that identifies as being part of a racial or ethnic minority. Minority enrollment has grown 111 percent since 2013.

Nearly every Medicare beneficiary in the US had access to at least one Medicare Advantage plan in 2021 (99.7 percent), the report found. However, enrollment still does not exceed original Medicare enrollment: 55 percent of Medicare beneficiaries are in original Medicare, while 45 percent are in Medicare Advantage plans.

Most Medicare Advantage beneficiaries are in their health plan due to their age. Only 8 million individuals are eligible for their Medicare Advantage plans due to a disability.

The top six states for Medicare Advantage enrollment in 2022 are Alabama (53.35 percent), Michigan (53.05 percent), Florida (52.75 percent), Connecticut (51.06 percent), and Main and Oregon (50.95 percent each).

Health maintenance organizations continue to dominate the Medicare Advantage market. Sixty percent of Medicare Advantage enrollment went to health maintenance organizations, while 36 percent went to local preferred provider organizations.

Special needs plan enrollment drove the overall Medicare Advantage enrollment rate, contributing nearly a third of the Medicare Advantage market’s growth (31 percent).

Medicare Advantage beneficiaries spend, on average, $1,965 less on out-of-pocket spending and premiums.

Premiums are the lowest they have been in 15 years, the report stated. The average premium for Medicare Advantage beneficiaries is $19. This is a ten percent decrease compared to 2021 premium levels.

Some Medicare Advantage beneficiaries do not have a premium for Medicare Advantage plans at all. Nearly two-thirds (65 percent) of all beneficiaries are enrolled in a $0 Premium MA-PD Plan.

In both Medicare Advantage and original Medicare, White beneficiaries have the highest total spending and the highest percent cost burden. However, prescription drug plans have a premium of $33.

In the future, Better Medicare Alliance has high expectations for Medicare Advantage plans. The organization projected that enrollment in Medicare Advantage would absorb more than half of the Medicare population by 2030 (52.4 percent).

“This report affirms what we already know: Medicare Advantage is working to deliver better outcomes and added benefits at a lower cost for an increasingly diverse beneficiary population. In these pages, readers will see why Included Health looks to Medicare Advantage plans as trusted partners to deliver the personalized, high-touch, high-tech care our members need and deserve,” added Todd Thames, MD, vice president of medical affairs for Included Health.