Despite all the negative news coming from Washington DC about Medicare Advantage programs, enrollment in this product continues to grow rapidly. As of July 1, Medicare Advantage enrollment topped 11.12 million, up nearly 700,000 members since January 1, 2009. Medicare Advantage membership surpassed 11 million enrollees in May.
Medicare Advantage appears to be the primary target of the Obama Administration (at least on the surface) in their health care “reform” efforts, and more Medicare Advantage companies are shifting from PFFS plans to Preferred Provider Organization (PPO) plans due to MIPPA 2008 requirements.
Health Maintenance Organizations (HMOs) have also lost significant Medicare Advantage market share since July 2006 as more consumers opt for PPO plans offering more choices of providers.
Overall, total Medicare Advantage plan enrollment as of July 1, 2009 stood at 11,120,953, a gain of 699,560 net new members from January to July 2009. The 6.7% growth rate through mid-year was down from 9.9% for the same timeframe one year ago. Ten organizations have collectively retained more than 60% market share for the last year and a half. Currently, UnitedHealth Group, 1,800,000 members, and Humana, with 1,505,000, together control almost 30% of the market. The rest of the top ten Medicare Advantage providers include Kaiser Foundation at 930,000, Coventry with 510,000, WellPoint at 427,000, Aetna at 423,000, BCBS of Michigan at 308,000, Highmark at 284,000, Health Net at 284,000, and Well Care at 250,000.
With President Obama pushing Congress for more changes in Medicare Advantage programs, MedigapAdvisors.com is strongly encouraging its clients to consider enrolling in a Medicare Supplement plan instead. While most Medicare Supplement plans cost $120 a month or more, in many areas you can obtain a High Deductible Medicare Supplement for as little as $40 per month. Those on a fixed budget that can not afford a Supplement should make every effort to enroll for a Medicare Advantage program with a large, A-rated carrier.
With nearly 1,000 Medicare Advantage plans in the country (725 which are expected to be dissolved this year because they contain less than ten members), Medicare Advantage plans face considerable challenges over the next year or two. When A.M. Best decides to “withdraw” ratings for 125 Medicare Advantage plans, that means something important is going on behind the curtains. We suspect that consolidation and acquisition of these plans by larger ones will be the outcome. But with all the uncertainty surrounding Medicare Advantage in general, larger Medicare Advantage plans may not wish to commit to more business than they now have.