Tuesday, November 3, 2020

The Growth of Medicare Advantage Plans in the Far West

With the Medicare open enrollment period underway through December 7th, many Medicare eligible seniors will be pondering a change in their Medicare coverage to a Medicare Advantage (MA) plan. MA Plans are a type of health plan offered by private insurers as an alternative to original Medicare.  MA plans, which have grown increasingly popular, are offered through private insurance companies that contract with the federal government to offer an alternative to Medicare Part A and Part B benefits coverage. With these MA plans, the U.S. government basically contracts private insurers to offer Medicare eligible individuals health plans that, at a minimum, match Original Medicare Part A and Part B benefits.  What gives MA plans their growing appeal is that private insurers have been able to bundle Part A and Part B benefits, plus a variety of additional benefits, into their plans at minimal to no cost to enrollees.

With lower costs and added benefits, Medicare Advantage plans can be an excellent value compared to Original Medicare.  This extra value that comes with MA plans is usually made possible, in part, by requiring enrollees to follow managed care protocols and use more restricted provider networks than are found with Original Medicare coverage.  While MA Plans can come in several insurance models, the most popular such plans feature HMO and PPO structures.  Notwithstanding managed care protocols and fewer provider choices, increasing numbers of Medicare eligible seniors are migrating to Medicare Advantage plans because of the value they offer.  As of October 2020, across all 50 states there were about 24 million Americans enrolled in MA plans, an increase of more than 40% in the past 4 years.  During this same timespan total Medicare enrollment across all 50 states has grown only about 10%, so with MA enrollment growing much faster than the overall Medicare population, MA's share of the Medicare market has been growing steadily, from just a 30% share four years ago to 39% today.

The increasing popularity of MA plans nationally is mirrored in the Far West, where MA plan enrollment over the past four years has grown nearly 25%.  During the same period, overall Medicare enrollment in the six-state region has grown a bit more than 11%, so the region has seen MA market share jump from about 38% four years ago to close to 43% today.  Here is a closer look at MA enrollment growth in the six-state Far West region over the last four years:

The Growth of Medicare Advantage Plans in the Far West
The Growth of Medicare Advantage Plans in the Far West

Medicare Eligible (in thousands) MA Enrollment (in thousands) % Growth
State 2020 2016 2020 2016 Eligible MedAdv
AK 105.4 86.6 1.3 0.4 21.7% 235.1%
CA 6439.2 5840.0 2825.7 2288.6 10.3% 23.5%
HI 281.7 252.3 134.8 115.3 11.6% 16.9%
NV 548.8 473.2 222.2 161.0 16.0% 38.1%
OR 888.5 786.9 419.6 347.3 12.9% 20.8%
WA 1404.2 1240.3 515.1 373.6 13.2% 37.9%
FW Only 9,668 8,679 4,119 3,286 11.4% 25.3%
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, check out our resource page Medicare Advantage Enrollment Growth.