Cuts in payments to Medicare Advantage insurers that were part of the Patient Protection and Affordable Care Act were widely expected to reduce growth in the Advantage program. Prior to the ACA, Medicare Advantage plans cost an average of 14% more per beneficiary than traditional Medicare. In 2013, that disparity dropped to 4%, according to the Medicare Payment Advisory Commission (PDF). More than one a quarter of all Medicare enrollees are now in Medicare Advantage plans.
“Some have predicted that there would be a decrease in enrollment or a decrease in plans offered, but that has yet to be borne out,” said Gretchen Jacobson, associate director of the Kaiser Family Foundation's Program on Medicare Policy, and a co-author of the study.
The Medicare Advantage market saw 289 new products introduced for 2014. That was offset by 349 plans that are no longer available to customers. The overwhelming majority of new products—80%—are HMOs.
Nearly half of the Medicare Advantage plans available are from Humana, UnitedHealth or Blue Cross and Blue Shield affiliates, including WellPoint, according to the Kaiser analysis. Humana has the greatest market penetration, with more than 80% of individuals eligible for Medicare having access to a plan sold by Humana.
“It's primarily been the same companies for the past few years that have been the dominant players in the Medicare Advantage market,” Jacobson said. “We haven't seen any large changes in that makeup.”
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