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December 4, 2019

Most Medicare beneficiaries don't switch health plans. Here's why that worries some experts.

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    Most Medicare beneficiaries do not switch health plans from year to year, even as new benefits become available and costs associated with the plans change, according to a Kaiser Family Foundation (KFF) analysis released Monday.

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    Analysis details

    For the analysis, KFF researchers reviewed data on Medicare beneficiaries enrolled in Medicare Advantage (MA) plans with prescription drug coverage (MA-PDs) or standalone Medicare Part D plans (PDPs), including those who switched health plans at some point from 2007 to 2016 during Medicare's annual open enrollment period. The researchers looked at data on beneficiaries who:

    • Did not switch health plans;
    • Switched health plans involuntarily, which researches defined as a beneficiary "whose plan exits the market, who is not crosswalked into a different plan, and who has to sign up for a different plan;" and
    • Switched health plans voluntarily.

    The researchers excluded data on beneficiaries who received low-income subsidies for the plans.

    The researchers also reviewed data from CMS' 2017 Medicare Current Beneficiary Survey to gauge beneficiaries' experience shopping for plans.


    The researchers noted that MA and Part D plans typically "vary significantly from each other and can change from one year to the next, which can have a significant impact on enrollees' coverage and costs." However, the researchers found that "[a] substantial majority of Medicare private plan enrollees have not voluntarily switched plans in any given year" from 2007 to 2016.

    Overall, the researchers estimated that the percentage of beneficiaries without low-income subsidies who voluntarily switched plans for the upcoming coverage year during an open enrollment period from 2007 to 2016 ranged between 6% and 11% for MA-PD enrollees and between 10% and 13% for PDP enrollees.

    When looking specifically at Medicare's open enrollment period for the 2017 coverage year, the researchers found that 8% of beneficiaries enrolled in MA-PDs and 10% of those enrolled in PDPs for the 2016 coverage year voluntarily switched to a different plan for the 2017 coverage year. They estimated that, among the 9.4 million total MA-PD beneficiaries without low-income subsidies in the 2016 coverage year:

    • 7.6%, or about 710,000 beneficiaries, voluntarily switched to another MA-PD plan for the 2017 coverage year during the open enrollment period; and
    • 0.9%, or about 90,000 beneficiaries, voluntarily switched to traditional Medicare with a PDP.

    Among the 11.7 million total PDP beneficiaries without low-income subsidies in the 2016 coverage year:

    • 8.3%, or about 980,000 beneficiaries, voluntarily switched to another PDP for the 2017 coverage year during the open enrollment period; and
    • 1.7%, or about 200,000 beneficiaries, voluntarily switched to an MA-PD.

    According to the researchers, 3% of MA-PD beneficiaries and less than 1% of PDP beneficiaries involuntarily switched plans during the open enrollment period because their plans exited the market and the beneficiaries "were not automatically crosswalked into a new plan." In addition, 8% of MA-PD beneficiaries and 3% of PDP beneficiaries were crosswalked into a new plan for the 2017 coverage year because their 2016 plans exited the market.

    The researchers noted that, based on their analysis of the Medicare Current Beneficiary Survey, about 45% of Medicare beneficiaries in 2017 said they never or rarely reviewed or compared their Medicare plan options, and about 35% said it was very or somewhat difficult to compare Medicare plan options.


    The researchers wrote that the "[r]elatively low rates of plan switching during the open enrollment period could indicate that beneficiaries are generally satisfied with their current plan and therefore have little motivation to compare and switch plans, or they may be actively choosing to remain in their plan after comparing other available options." However, they added that the findings "also indicate that many beneficiaries find the process of comparing plans too challenging, are unaware of the open enrollment period, or have limited confidence in their ability to choose a better plan."

    The researchers said those issues could have implications for Medicare's current open enrollment period, noting that consumers have an average of 28 MA and 28 standalone Part D plans from which to choose for the 2020 coverage year (King, FierceHealthcare, 12/2; Owens, "Vitals," Axios, 12/3; KFF analysis, 12/2).

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