New Study Sheds Light on Which Seniors Are Driving the Rise in Medicare Advantage Enrollment

“A new study from the Kaiser Family Foundation counters the popular misperception that the steady rise in Medicare Advantage enrollment has been driven by members of the Baby Boom generation overwhelmingly choosing the private plans as they become eligible for Medicare. Instead, the study finds that a majority of new enrollees in Medicare Advantage in each year were, in fact, seniors switching from traditional Medicare. Less than one-quarter of people newly eligible for Medicare enrolled in Medicare Advantage from the outset, and they comprised less than half of all new Medicare Advantage enrollees each year between 2006 and 2011. Nonetheless, the study, published today in the journal Health Affairs, also finds that the share of seniors who switch between traditional Medicare and Medicare Advantage is relatively small, reinforcing the notion that most Medicare beneficiaries make a coverage choice and stick with it. The new analysis finds that:
A growing share of people newly eligible for Medicare – but still less than one in four – elected to be covered under Medicare Advantage plans instead of traditional Medicare, rising from 15 percent in 2006 to 22 percent in 2011;
In each year between 2006 and 2011, the majority of new Medicare Advantage enrollees were people who had switched from traditional Medicare; seniors in their first few years on Medicare (in their late sixties) switched from traditional Medicare to Medicare Advantage at higher than average rates;
In each year between 2006 and 2011, fewer than 5 percent of traditional Medicare beneficiaries switched to Medicare Advantage, and a similar percentage of Medicare Advantage enrollees switched to traditional Medicare, suggesting that initial coverage decisions made by Medicare beneficiaries have long-lasting effects;
People dually eligible for Medicare and Medicaid (“dual eligibles”) and Medicare beneficiaries under age 65 and disabled disenrolled from Medicare Advantage at higher than average rates, a trend worth exploring because these beneficiaries tend to have significant health care needs.