Enrollment in Medicare Advantage continues to climb as we enter enrollment season
I decided to continue my Medicare Advantage (MA) monthly enrollment blogs because of continuing month-over-month increases. The growth is tied to remaining strong benefit packages for 2024.
Increases in MA enrollment still occur outside of the enrollment season given the aging of America and the ability of some populations, such as dual eligibles, to continue to make changes throughout the year. New enrollees see huge value in enrolling in MA over the traditional fee-for-service (FFS) program. This value difference will continue to drive growth in 2025.
Open enrollment began October 15 for 2025 benefits. We normally would see enrollment pick up a great deal in November and December as some switch to their new plans early. But that is unclear because many plans will rein in benefits and geographies for contract year 2025 due to significantly deteriorating bottom lines. This is being caused by the return of robust utilization, inflation picking up in the healthcare sector (especially at hospitals), poor Star scores, negative rate increases for 2024 and 2025, new regulatory burdens (such as the new prior authorization restrictions), and the greater costs MA plans will bear due to the Inflation Reduction Act’s (IRA) Part D changes.
As I have reported, growth from January 2023 to January 2024 was a robust 8.7% increase or 2.674 million. Enrollment in MA reached 33.473 million in January 2024. Since that time, enrollment has continued to climb:
- By about 183,000 from January 1 to February 1.
- By about 144,000 from February 1 to March 1.
- By about 86,000 from March 1 to April 1.
- By about 100,000 from April 1 to May 1.
- By about 98,000 from May 1 to June 1.
- By about 72,000 from June 1 to July 1.
- By about 87,000 from July 1 to August 1.
- By about 70,000 from August 1 to September 1
- By about 84,000 from September 1 to October 1, a growth of 0.24%.
Enrollment in MA has now hit 34.397 million. The growth from January 1 to October 1 represents an additional approximate 2.8% increase or about 924,000 lives. MA enrollment has now increased to just shy of 51% of all Medicare beneficiaries.
As we saw from January 2023 to January 2024, PPO growth now significantly outstrips HMO growth. From January 1 to October 1, HMOs grew by about 331,000, with PPOs growing about 586,000. HMOs grew about 35,000 from September to October, with PPOs growing about 48,000 in that timeframe.
Special Needs Plans (SNPs) continued to do very well too. After growing about 1.154 million from January 2023 to January 2024, SNPs grew by another approximate 330,000 from January to October. SNP enrollment grew by about 39,000 from September to October. About 46% of all MA enrollment growth from September to October was in SNPs. Plans are making huge new investments in SNPs for 2025 and we will see SNP growth continue to grow and perhaps accelerate.
Big Plans continue to dominate the program with about 76% of all enrollment. But only about 70% of the growth (59,000 of 84,000) from September 1 to October 1 was captured by the Big 9 national plans (that number was just 62% from August 1 to September 1). About 25,000, or 30%, of September to October 2024 growth was from regional and local plans.
CVS Health’s Aetna had most of the Big Plan growth this past month (about 22,000) due to strong 2024 benefits and expansions, followed by Humana at about 19,000 and United Healthcare at about 11,000. But both CVS Health’s Aetna and Humana will reduce benefits and geographies next year because of major medical expense and margin issues in MA.
About 78% of the growth from January to October 2024 was in the Big 9 national plans. If you adjust out the Bright Health lives acquired by Molina, the total is about 67%. Thus, Big 9 organic growth is under its actual penetration in MA. This underperformance as well as the potential benefit cuts and geographic contractions by big plans in 2025 offer some hope for future growth to the small- and medium-sized plans in MA.
Notes:
I am using the official MA monthly enrollment figures found here: https://www.cms.gov/data-research/statistics-trends-and-reports/medicare-advantagepart-d-contract-and-enrollment-data/monthly-enrollment-plan . As well, I am using monthly total enrollment for Medicare to calculate MA penetration found here: The site is here: https://data.cms.gov/summary-statistics-on-beneficiary-enrollment/medicare-and-medicaid-reports/medicare-monthly-enrollment .
#medicareadvantage #partd #pdp #coverage
— Marc S. Ryan