Report: Medicare Advantage Enrollment Sees Continued Growth, but at a Slower Rate

Medicare Advantage enrollment grew to 29.5 million people for the 2023 plan year, now representing 46% of total Medicare enrollment, according to a Tuesday report from The Chartis Group. However, enrollment is growing at a slightly slower rate than previous years.

Participation in Medicare Advantage plans increased by 5.5% this year, or by 1.5 million beneficiaries. But in 2020, 2021 and 2022, enrollment rose by 1.9 million, 2.2 million and 2.3 million, respectively.

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“Tailwinds that have propelled Medicare Advantage popularity persist as we look at the 2023 plan year,” the report said. “Despite some tumult in the market — from changes to the Risk Adjustment Data Validation (RADV) program, actions from the Centers for Medicare and Medicaid Services (CMS) for select plans, and some headline-grabbing retreats from start-up plans — this year saw record enrollment and pushed program penetration past 46%.”

Enrollment in traditional Medicare, meanwhile, is still decreasing, but at a slower rate than years prior. This year, traditional Medicare dropped by 339,000 beneficiaries. In 2020, 2021 and 2022, enrollment declined by 400,000, 1 million and 1.3 million, respectively.

Additional findings from the report include:

Enrollment in Special Needs Plans grew by 1 million enrollees, or 20%, to 5.5 million people. The growth in Special Needs Plans represents two-thirds of Medicare Advantage enrollment growth.
For-profit insurers represent 72.6% of all enrollment in Medicare Advantage, an increase from 71.8% in 2022 and 67.9% in 2019. Nonprofit enrollment accounted for 17.3% of enrollment this year, while Blue Cross Blue Shield plans accounted for 10.2% of enrollment. This is the first time in several years that Blue Cross Blue Shield has seen growth in the share of enrollment for Medicare Advantage.
UnitedHealthcare is responsible for 55.2% of Medicare Advantage enrollment growth this year, and Humana is responsible for 22.5% of the growth. This means that these two payers represent four in five new enrollees.
Start-up plans are seeing growth, with their enrollment increasing by 7% this year. However, this is slower than prior years. Their share of Medicare Advantage enrollment is 1.7%.
Fifteen states have at least 50% of their Medicare population enrolled in Medicare Advantage plans, up from 11 states the year prior. California, Illinois, Connecticut and Washington D.C. all experienced decreases in Medicare Advantage enrollment and increases in traditional Medicare enrollment.
Options for Medicare Advantage plans are at an all-time high, increasing by about 11% per year. Medicare Advantage enrollees had 4,100 plan options and Special Needs Plans had 1,300 options.