Did you sign up for a Medicare Advantage plan to get some stability and peace in your life? But now, the ever-changing trends have you glued to the smartphone – constantly searching for what new update has been made.

We totally get it!

That’s why we have compiled this article. From what percentage of Medicare beneficiaries are enrolled in the program to future projections, here is everything you need to know about possible changes to your Medicare Advantage membership. Let’s dive in!

What’s a Medicare Advantage plan?

Before we get into the nitty-gritty of the future of Medicare Advantage, let’s clarify what it actually is.

Medicare Advantage is an alternative way for you to receive your Medicare benefits. 

Instead of getting your coverage directly from the government’s Original Medicare (Medicare Part A and Part B), you can choose a private insurance plan approved by Medicare.

When you opt for a Medicare Advantage Plan, you still have the same coverage as Original Medicare, but the private insurer becomes your main point of contact for managing your healthcare needs. 

These plans often include extra benefits that traditional Medicare doesn’t cover, such as vision, dental, hearing, and prescription drug coverage – all bundled together in one comprehensive package.

Please note Medicare Advantage plans can change from year to year. So, it’s a good idea to review your plan annually during the enrollment period and ensure it still meets your requirements.

What’s the current percentage of Medicare beneficiaries in Medicare Advantage? 

As of January 2023, a little more than 50% of Medicare beneficiaries are enrolled in private Medicare Advantage plans. That’s about 30.19 million people!

This is a significant increase from 2007 when only 19% of eligible Medicare beneficiaries opted for these plans. What’s even more surprising is that the growth of Medicare Advantage plans has remained slow over the years. 

People usually preferred the traditional Original Medicare program. It was simple, with predictable costs and good coverage. But, after 2018, Medicare Advantage plans saw an all-time hike in its popularity. 

Its enrollment percentage rose from 37% in 2018 to 50% in 2023. That’s a 13% increase in 5 years compared to the 18% increase in 11 years!

According to the survey from the Commonwealth Fund, this growth of Medicare Advantage plans is because of the extra benefits offered. These plans offer vision, hearing, and dental coverage – unlike Original Medicare. 

Most MA plans are also offering to bundle Part D drug prescription coverage into their plans. This makes them all-in-one packages at the same or even lower rates. 

Another benefit is lower out-of-pocket spending limits. The Commonwealth Fund survey identified that 1 in 5 beneficiaries are choosing Medicare Advantage plans because of this reason.

In case you don’t know, the out-of-pocket limit is the maximum amount you have to spend to avail of certain insurance benefits. So, having a lower out-of-pocket limit means you get to save more money!

Future Medicare Advantage growth projections 

Considering the recent growth patterns, it’s certain that the popularity of Medicare Advantage is increasing as more people see the value and benefits it offers.

And it’s not just that. People are also genuinely happy with these plans.

In 2022, JD Power conducted a study where it measured the satisfaction levels of the enrolled MA beneficiaries. When the results were collected and analyzed, Medicare Advantage received 809 out of 1000 points — 3 points higher than in 2021. So, more people are signing up for MA plans because they offer both high value for money and satisfaction.

It is predicted that Medicare Advantage will reach 69% of beneficiaries by the end of 2030. And by the looks of the changes being made to MA plans, this might happen much sooner than we think!

Why is Medicare Advantage growing? 

As discussed, Medicare Advantage mainly grew because of the extra benefits it offers compared to the traditional Medicare program. But this doesn’t mean it’s free from challenges. 

The rapid Medicare Advantage growth has come with the following issues:

• Misleading advertisements
• Prior authorization requirements causing delays in patient care
• Insufficient coverage for substance use disorder services and mental health treatments
• Overpayment due to structural problems

All of these led to scrutiny of the MA plans. Policymakers and related authorities pointed out these issues, which has made beneficiaries worried about their healthcare safety. But we’ll like to highlight that the HHS and CMS have taken notice. 

They have decided to make multiple changes that will improve Medicare Advantage Plans a lot. This significant update is the reason why the participation rate increased by a whopping 9.5%, and 2.7 million beneficiaries enrolled themselves in the MA plans.

Let’s have a look at what these amazing changes are!

Latest changes in the Medicare Advantage plans 

Recently, the U.S. Department of Health and Human Services (HHS) finalized a rule to prioritize Medicare beneficiaries and offer strong protections so that MA plans work effectively for their benefit. Here are the changes being made under this rule:

Crack down on misleading marketing schemes

Ads must now mention a specific plan name and cannot misuse Medicare’s name, CMS logo, or any government-issued information to deceive people. Misleading marketing against Part D coverage will be strictly monitored. 

Also, the rule enhances accountability for plans to oversee agent and broker activities. These changes ensure that beneficiaries get clear and truthful information when choosing their Medicare plans.

Removal of barriers created by complex prior authorization and utilization management

CMS is taking steps to ensure Medicare Advantage enrollees have access to the same medically necessary care as those in Traditional Medicare. The new rule simplifies prior authorization requirements. So, approved authorizations remain valid for as long as needed – preventing care disruptions. 

Medicare Advantage plans will also review utilization management policies annually and denials based on medical necessity will be reviewed by healthcare experts before being issued. 

These changes will work together with other proposals to improve the prior authorization process, making it easier for beneficiaries to get the care they need.

Expansion of access to behavioral health care

Now, behavioral health is going to be a crucial part of whole-person care. CMS is strengthening the behavioral health network in Medicare Advantage by including clinical psychologists and licensed clinical social workers in the evaluation process. 

It is also setting standards for wait times for behavioral health and primary care services and requiring plans to give patients specific notices if these providers are removed from their networks. 

Also, most Medicare Advantage plans are required to include behavioral health services in their care coordination programs so that people’s mental health needs are well taken care of.

Promotion of more equitable care

What’s more, CMS is working to make healthcare fair for everyone and improve the quality of health coverage. They are creating a health equity index in the Star Ratings program to reward Medicare Advantage and Medicare Part D plans that give excellent care to underserved communities. 

Plans will also need to offer culturally sensitive care to a wider range of people and improve access to care for those with limited English skills by providing materials in different languages. 

Implementation of President Biden’s new prescription drug law

Under President Biden’s new prescription drug law, more people with incomes up to 150% of the federal poverty level will be allowed to qualify for the full low-income subsidy (also called “Extra Help“). 

The finalized rule puts into action so that around 300,000 low-income individuals can get affordable prescription drug coverage. This change will start on January 1, 2024, and will give the full subsidy to those who currently qualify for a partial subsidy. 

So, eligible beneficiaries won’t need to pay deductibles or premiums. They will also enjoy lower, fixed copayments for specific medications under Part D coverage.

VBID model

CMS is providing details about extending the Medicare Advantage Value-Based Insurance Design (VBID) Model from 2025 to 2030. 

The extension aims to make improvements that better tackle patients’ health-related social needs, promote health equity, and enhance care coordination for those with serious illnesses. 

Will the costs of MA plans increase? 

The growing Medicare Advantage plans are going to make healthcare a lot better and easier for seniors in the US. However, the changes will not come for free.

CMS has announced that Medicare Advantage payments will increase by 3.32% in 2024. This means there will be a 2.28% increase in the effective growth rate. According to sources, this is because of the rising Medicare Fee-For-Service (FFS) per capita costs.