The Medicare open enrollment period is now underway and will run through December 7th. During this period many Medicare eligible individuals will be weighing a switch to a Medicare Advantage (MA) plan. MA Plans, which have been growing in popularity for many years, are a type of health plan offered by private companies as an alternative to original Medicare. Medicare Advantage plans are offered through private insurers that contract with the federal government to provide an alternative to Medicare Part A and Part B benefits coverage. With a MA Plan, the U.S. government basically pays a stated amount to a private insurer to offer a Medicare eligible individual with a health plan that, at a minimum, matches Original Medicare Part A and Part B benefits. What gives Medicare Advantage plans their appeal to many seniors is that private insurers have been able to bundle Part A and Part B benefits, plus a variety of added benefits, into their plans at little to no cost to enrollees.
With lower costs and more benefits, MA Plans can be an outstanding value compared to Original Medicare. The added value that comes with a MA plan is frequently made possible, in part, from the imposition of managed care protocols and restricted provider networks not found with Original Medicare. While MA Plans can come in a variety of insurance models, the most popular MA plans feature health maintenance organization and preferred provider organization structures. Even with managed care protocols and fewer provider choices, more and more Medicare eligible seniors are gravitating to the value MA plans offer. As of October 2020, in all 50 states there are about 24 million Americans enrolled in MA plans, an increase of more than 40% in the past 4 years. During this same timeframe total Medicare enrollment in all 50 states has grown at a slower pace, only about 10%, so the market share of MA plans in the Medicare marketplace has been growing steadily, from a 30% share four years ago to 39% today.
The growing popularity of MA plans nationally is mirrored in the Southwest, where Medicare Advantage plan enrollment over the past four years has grown nearly 47%, in comparison to national MA enrollment growth of just over 42% during the same time period. Here is a quick look at state-by-state Medicare Advantage enrollment growth in the four-state Southwest region over the last four years:
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Medicare Advantage Enrollment Growth in the Southwest |
| Medicare Eligible (in thousands) | MA Enrollment (in thousands) | % Growth | ||||||
|---|---|---|---|---|---|---|---|---|
| State | 2020 | 2016 | 2020 | 2016 | Eligible | MedAdv | ||
| AZ | 1364.8 | 1186.6 | 585.0 | 450.6 | 15.0% | 29.8% | ||
| NM | 434.1 | 386.3 | 172.1 | 124.8 | 12.4% | 38.0% | ||
| OK | 754.2 | 698.8 | 192.0 | 119.0 | 7.9% | 61.4% | ||
| TX | 4289.6 | 3778.6 | 1810.5 | 1185.4 | 13.5% | 52.7% | ||
| SW Only | 6,842 | 6,050 | 2,760 | 1.880 | 13.1% | 46.8% | ||
| All States | 61,584 | 55,972 | 24,050 | 16,909 | 10.0% | 42.2% | ||
For a summary look at MA plan enrollment growth in other states, visit our resource page Medicare Advantage Enrollment Growth.
