Joanne (00:00):

Are Medicare Advantage plans becoming the go-to coverage option? What about Medicare Supplement enrollment trends? What does this mean for you and your Medicare choices? Well, you're going to find out in today's episode.

Cameron (00:09):

But before we start, my name is Cameron Giardini and together with my co-host Joanne Giardini Russell, we operate Giardini Medicare, which is an independent insurance agency based out of Southeast Michigan. And although we are based in Michigan, we do work virtually over the phone to directly help consumers in about 13 different states to find the right Medicare coverage for them. If we do not work in your state, we will connect you with another trusted independent agent that will be able to help you find the coverage that you want. And even if you choose not to work with us or anybody that we're acquainted with, we do know that the information in today's podcast will help you have a successful and stress-free transition to Medicare. So, Joanne, give a brief overview because there's going to be a lot to cover in today's episode.

Joanne (00:49):

There is a lot and, actually, this is a really fun episode because there's a lot in here and when it comes to Medicare, we often talk about the fact that one of the biggest decisions that you're going to make is whether or not you'll enroll into a Medicare Advantage plan as an alternative to Original Medicare, or you'll enroll in a Medicare Supplement plan that is secondary to Original Medicare. Now this decision will come down to your individual wants and needs, but sometimes it can also be helpful to understand the overall trends in the Medicare market to see what your peers are choosing for their Medicare coverage. So in today's episode, we will take a look at national enrollment and cost trends for the different Medicare options and we will break down what this can mean for you and your individual Medicare insurance choices.

Cameron (01:28):

Yeah, exactly. This whole episode kind of comes from the fact that we often hear from people that ask us, well, what are other people doing? Or what do most of your clients do? And that's just a small sample size that yes, can be helpful, but we wanted to look nationally and even statewide to see what trends are happening, especially now in 2023, Medicare continues to change. We just want to tell you how that is reflected in the data and more importantly, what that might mean to you. And I know we already mentioned there's a lot to cover, but we will have a bunch of different sources in these show notes for this episode. So, if you want to look at any of the data we're referencing, you can always go there to look for more details. First, let's look at original Medicare trends.

Cameron (02:10):

And just keep in mind when we talk about Original Medicare, we are only talking about parts A and part B of Medicare. Based on the 2022 Medicare trustees report, there is an estimate that in 2022 there were 65 million Medicare beneficiaries, and they project this will be 66.6 million in 2023. Now this report, it also projects that by 2030 this number will increase to 77.4 million beneficiaries all the way up to 83.9 million by 2040. So all that is saying, it is increasing at a very rapid pace as far as the overall number of Medicare beneficiaries. And you may have heard this before, but the main reason for this is that more than 10,000 new enrollees are turning 65 every day. And that's not even counting people that are under 65 and eligible for disability and Medicare as well. In 2019, 50.4 million beneficiaries or 8.7% of total beneficiaries had no supplemental coverage, no advantage plan coverage, or really nothing else besides part A and part B. We just bring that up because sometimes people ask us, well, do I have to do anything? Can I just keep my Original Medicare? You can. And there's actually 8.7% that do that. But we will mention why we don't really recommend that. But just throwing out that data there.

Joanne (03:29):

So, those are staggering numbers, even though I know the numbers, they're still amazing. The takeaway for this with Original Medicare, remember that is part A and part B only, and that is from the federal government. But original Medicare enrollment is continuing to grow at a record pace, and this is going to likely cause the landscape to change greatly over the decades to come. So, we have learned that roughly 9% of the beneficiaries only have Original Medicare, meaning they only have part A and part B. And this is always a good place to be. This a good reminder for all of you that Medicare's going to cover 80% of the cost of most services and there is no financial cap to that 20% that a person may owe. So if you do not want any other coverage than Original Medicare, we do at least recommend that you consider a high-deductible Medigap plan. So you have some protection there.

Cameron (04:16):

Yeah, and we'll talk more about those high-deductible Medigap plans in other episodes. And if you have any interest in that, feel free to reach out and ask us questions directly. But we're going to move on from original Medicare since that is a small portion of the puzzle. What's more what happens after you get part A and part B of Medicare and what coverage do you enroll in next, is it going to be Medicare Supplements or Medicare Advantage plans? So, I'll have Joanne start here with the overall Medigap trends.

Joanne (04:42):

As Cameron mentioned, this is the most confusing piece for people. It's just deciding between this Medigap versus Medicare advantage. Hopefully, a lot of these numbers and studies are going to help you. But again, according to a telos actuarial study, and again it'll be in the show notes, as of 2021, there were 14.4 million Medicare beneficiaries enrolled in a Medicare supplement plan. Now with this study, Telos projects that this is going to increase to 15.8 million by 2025 and increase further to 18.1 million by the year 2030. So, the rate of Medigap enrollment has slowed in recent years. For example, from 2010 to 2013, there was a 3% average growth of Medigap enrollments from the next three-year period. From 2014 to 2017, there was a 5.4% average growth. And from 2018 to 2021, the growth rate was 1.6% on average with 2021 having negative enrollment numbers for that year. 

Cameron (05:44):

Yeah, so overall it's just good to think of the Medigap enrollment numbers, they are increasing but they are slowing at the pace at which they are increasing. But perhaps more importantly to you as an individual, you want to know what about specific Medigap plans. So we're talking plan N, plan G, plan F. You know, if you've ever really investigated Medigap plans, you want to know which plan is right for you and which one is trending upwards or downwards. So in 2021, Plan G and Plan N made up about 41% of the total Medigap market compared to plan F and plan C, which made up about 46% of the overall market. So if you just look at that, you would say, okay, plan F and plan C are the more popular options compared to Plan N or plan G. Now that is part of it.

Cameron (06:31):

However, plan N and Plan G, are growing much, much more rapidly. Between 2019 and 2021, basically the most recent years, 71% of newly issued plans or newly issued Medigap plans were plan G or plan N, while only about 18% were plan F or plan C during that same time. So again, the other number that shows Plan F and Plan C is more popular overall that's using data from the past couple of decades. So, there are a lot of people that still have those plans, whereas it is by a wide margin, people are enrolling in Plan G or Plan N at a faster pace now and out of the two, if you look at plan N and Plan G, plan G is the real winner when it comes to enrollment numbers. Between Plan N and Plan G, 85% of enrollees during that same three-year period actually picked Plan G versus only about 15% for Plan N. And overall, this is consistent with what our clients choose to do. It also goes with our recommendation to consider plan G or plan N over plan F or plan C if they're available to you. And we only expect that this trend will continue. 

Joanne (07:35):

Don't forget that people that were eligible prior to 2020 are the only people eligible for plan F and plan C any longer. So of course, that's going to make Plan G and Plan N more popular. But it is interesting that more people choose G. But as Cameron said, that is what we kind of see with our average everyday clientele.

Cameron (07:52):

Now you might be thinking too, what about the cost as far as Medigap plans go? So, Joanne can talk about that and we will let you know.

Joanne (07:58):

Now we're going to talk about how many Medigap options you may have and what the cost may be based on the state that you live in.

Cameron (08:04):

This is important. 

Joanne (08:06):

It is. Everything is on a state-by-state, zip code-by-zip code with Medigap. Now we're going to look at the number of insurance companies that are offering plans in the specific zip code or area in which you might reside. We just pulled five states as examples, in Michigan, where we are based, there are 46 options, meaning 46 insurance companies are offering Medigap plans in our state. In Florida, that number is reduced to 31 insurance companies, and in Texas, it's bigger than Michigan, it's 48 options. In New York, look at this, there are only 8 insurance companies, and in California about 20. Now I want to take a minute and talk about the lowest Medigap costs that are in different states or different markets. What we did is we pulled the lowest plan G for a male turning 65 years old. And we compared the same states, Michigan $113 per month, Florida $178 per month, Texas $107 per month, New York, $210 per month in California, and $120 per month. So the moral of that story is that Medigap premiums are highly dependent on your state and even down to your zip code. So it's really important to get the cost for your local options when you're deciding on what plan you're going to enroll in. And as always, don't just go with the cheapest plan.

Cameron (09:18):

Yeah, exactly. So if somebody's giving you advice and they're not looking at your local market, it truly means nothing when it comes to Medicap plans. Because if somebody says, oh, you can get a plan for $90 a month and you're living in New York, that is probably not even going to be a possibility for you. So again, find somebody in your local area, I don't care if it's SHIP counselors, whoever it might be, but find somebody that knows the local prices in your area before you even consider Medigap plans as an option. So just to recap some of the takeaways from the Medigap data, we talked about Plan G and Plan N being here to stay and they're very clearly the most popular plans at this point. So if you do not have access to Plan F and you thought you may have wanted it, don't worry about it.

Cameron (09:57):

There are many better alternatives at this point. Plan N may be a better value a lot of times, but people at the end of the day, really want Plan G and that is what they choose to enroll in. So, if you see videos or other people talking about you must go with Plan N, just understand that if you still want Plan G, you're probably in the majority, but consider both because they are both good options. And then lastly, we just talked about it, Medigap plans and prices, vary based on where you live in the country. So don't listen to specific advice unless somebody is specifically talking about your state and even more importantly your zip code. So now we'll shift our focus, we'll get away from Medigap trends and we're going to talk about Medicare Advantage trends. Overall, the trend is basically that there are more plan options and more benefit options than ever before.

Cameron (10:43):

When it comes to Medicare Advantage plans, this has been true for the past decade. Growth is just really increasing, especially over the past five years. And you'll see a lot of people on social media, who are against Medicare Advantage plans, but unfortunately based on the data for them, they are certainly here to stay. So again, consider both. We are not pro-Medicare Advantage versus Medigap, it's pro whatever makes sense for you and understand that Medicare Advantage plans are only becoming more popular. This can be seen based on the enrollment data where Medicare Advantage plans have more than doubled in enrollments since 2007. And that's not just the total number of enrollees, but that's actually the overall percentage of eligible people that can enroll in a Medicare Advantage plan. And then just quickly, we always want to point out HMO versus PPO data because if you are unaware, they are both available as Medicare Advantage plans. I know some people think that Medicare Advantage plans are only HMOs but they are available as HMOs or PPOs in most areas. According to the Kaiser Family Foundation, in 2022 out of 3,800 total advantage plans, 38% were PPOs and about 59% were HMOs. Now, this has grown because if you compare this to five years ago in 2018 out of 2300 total plans, 26% were PPOs versus about 67% were HMOs. So again, a lot of data there, but just know that PPO growth is happening at a faster pace than HMO growth.

Joanne (12:10):

And talking about growth, and again, the entire market growth here, nationally the average beneficiary today can choose from 43 Medicare Advantage plans and that's 2023 numbers. Now this number was as low as 20 plans per person just back in 2018, which was not long ago at all. Now in metro Detroit looking at Michigan, some counties in our area have 76 Medicare Advantage plans. That means 76 options. So this really highlights the growing need for you actually to seek help from an independent broker that can help you compare the relevant options. Because 76 is tough to kind of balance and look at. Also, when we talk about location, just as with Medigap, it also matters kind of where you live with Medicare Advantage. Now there's this urban versus rural divide. So this means that in 2023 those people living in the metro areas, nationally, they can choose from 46 plans on average compared to 29 plans in a rural area.

Joanne (13:08):

So do keep your expectations realistic if you're living in a rural area. Medigap is often more popular in those, smaller non-network-driven areas. And there is a large difference between states. There's a percentage of Medicare Advantage penetration, it varies widely by state. In 2022, Wyoming had 7% of eligible beneficiaries, which means of those people that are enrolled in Medicare parts A and B, only 7% of those people were enrolled in a Medicare Advantage plan. Alaska only had 1% enrolled in Medicare Advantage plans. However, let's contrast that to Michigan and Florida, each of those states had 56%. So you can really see how it's driven based on whether you are in an urban area or a rural area.

Cameron (13:55):

Exactly. It's always good to keep in mind because you'll notice that a lot of these trends have to do with where you live. So if the one takeaway from this episode is that where you live really, really matters for your choices with Medicare, we'll be happy with that. But the number of plans available is also not the same as the number of companies that are providing plans. Joanne just mentioned that here in metro Detroit, we have up to about 76 plans in some counties. Now, that doesn't mean we have 76 insurance companies offering plans. There are many that offer multiple, but in 2023, the average Medicare beneficiary nationwide will have Medicare Advantage plans offered to them by nine different insurance companies. But enrollment is not spread out evenly though, Humana, and UnitedHealthcare, and the larger companies like that, account for about 46% of total enrollments.

Cameron (14:44):

And a lot of these companies are offering multiple plans. In about half of the counties nationwide, there's at least one insurance company that's offering 10 or more plans. So think about that. That means some of these companies are offering 10 plans just in one county. Again, this just highlights the fact that having a broker can really help you narrow down these plan options. Imagine calling nine different insurance companies and going through 10 plans each just to figure out which one might work for you. It's just not feasible at this point. 

Joanne (15:14):

Yeah, it's a nightmare.

Cameron (15:15):

And then not only are overall Medicare Advantage plans exploding in popularity, but the dual special needs plans are really catching on as well. So these plan options are for those eligible for both Medicare and Medicaid and they have almost doubled in availability since just 2018. So in 2018, there were 401 dual special needs plans available nationally compared to all the way up to 789 Now in 2023. This is a huge contributing factor to the increase in TV advertisements and postcards and just all the advertisements you're getting when it comes to Medicare because these plans, really offer the richest benefits by far when it comes to Medicare plan options. So anytime you see advertisements mentioning benefits that just seem too good to be true, they are true. However, they're probably referring to dual special needs plans that not everyone is eligible for. And along those lines, Joanne can talk about the overall trends in extra benefits with Medicare Advantage plans.

Joanne (16:14):

Right? And to go back to the dual eligible. Just remember that many, many of you that are hearing the same ads Cameron just talked about, don't qualify. All right? That's a really big thing to try and remember, but there are lots and lots of Medicare Advantage plans that do offer a whole bunch of extra benefits that you would qualify for. According to the Kaiser Family Foundation, in 2023, 99% of Medicare beneficiaries live in a county with at least one Medicare Advantage plan with dental, vision, hearing, and fitness benefits, basically all of you. So now you know when you see an advertisement saying on TV that you may be eligible, you can be almost certain that the answer is you are eligible. So now you don't have to be tricked into calling the ads for more information. They are already fully aware that you are already qualified based on that district right there.

Joanne (16:59):

Now here are the stats for the percentage of Medicare Advantage plans in 2023. They'll be offering other popular extra benefits. 97% of those plans will have over-the-counter benefits. But less common are the in-home services with only 14% that are providing in-home support. And sometimes it can be limited. 10% are providing bathroom safety devices or providing caregiver support and 3% are providing Telemonitoring services like personal emergency services. Think of Life Alert and things like that. Just know when you do see some of those things on tv, you know looking for caregiver support and things like that, everybody wants those built in. So just check the fine details with an agent. It is important.

Cameron (17:48):

And along with the trends with Medicare Advantage plans, as far as the benefits go, it's always good to know about the cost trends when it comes to these plans. Just so you know, in 2023, the projected average Medicare Advantage premium is $18 per month, and this is an 8% decrease from $19.52 per month in the previous year. However, that only tells a small part of the story because when it comes to Medicare Advantage premiums, it is very likely if you enroll in one of these plans, you'll end up with a plan that has a $0 monthly premium in addition to what you pay for part B of Medicare. And this is backed up by showing that $0 premium plans, continue to increase in availability. 66% of Medicare Advantage plans in 2023 will have a $0 premium compared to 59% of plans in 2022.

Cameron (18:40):

99% of Medicare beneficiaries have access to $0 premium Medicare Advantage plans with Alaska being the only outlier, not offering one of these plans according to the Kaiser Family Foundation. And you have probably even seen all of the advertisements that say you can get money back in your Social Security think JJ Walker. Well in 2023, 17% of Medicare Advantage plans will offer some reduction in part B premium. Again, if you hear somebody that you know, say I have a plan for no premium, or you see an advertisement that says you may be eligible for a plan for no premium, you are, I mean, unless you're in Alaska, you have these plans available to you. It's not uncommon, there's not really a catch to it. They're funded by the government. It’s very common to have a zero-premium Medicare advantage plan. And it's even more common for plans to start offering some money back in your Social security or reductions in Part B.

Joanne (19:36):

I think it's becoming even more uncommon, Cameron, when we have someone come that wants a Medicare Advantage plan, do we ever give them a plan with a premium hardly ever these days?

Cameron (19:43):

Uh, that's not often <laugh>,

Joanne (19:44):

Right? So what are those Medicare Advantage takeaways? Well, there are more Medicare Advantage plans being offered than ever. It's even more important now to reach out to an independent broker. Just as we said, if you have 50 or 70 plans, it's tough to go through. PPOs are gaining in popularity based on plan offerings as well as consumer enrollments. The plan options for urban versus rural areas vary greatly. So if you live in one of those rural areas, be prepared for a more limited number of Medicare Advantage plans. Be careful there and remember that almost all Medicare beneficiaries have access to Medicare Advantage plans with a zero monthly premium and some type of extra benefits like dental vision and hearing. So please, please don't get tempted by TV advertisements because of this.

Cameron (20:27):

Exactly. Well said. Now we are getting closer to the end of today's episode. Thankfully there's a lot of data, so we'll try to wrap things up here, but we want to talk briefly about Medicare Advantage versus Medigap trends. So again, we just want to compare the two main options. So based on data that we have in this episode in 2022, there were about 18.7 million enrollees enrolled in a Medicare Advantage plan. Now we're not talking about people that get advantage plans from their former employer or dual special needs plans. We're really talking about people with just A and B that choose to get a Medicare advantage plan. So again, that's 18.7 million in 2022. Now, we couldn't find the number directly for 2022 when it comes to Medigap, but there were 14.4 million people enrolled in a Medigap plan in 2021. So, you can see that as of now, Medicare Advantage plans have a higher number of total enrollment versus Medigap plans. And then again, just to highlight that urban versus rural divide when it comes to people in urban areas, there is a higher percentage of those people enrolled in Medicare Advantage plans versus rural areas where they have a higher portion of Medigap enrollees when compared to their same urban counterparts.

Joanne (21:39):

And quite frankly, that's just because the plans aren't available in rural areas. 

Cameron (21:43):

Simply it's not that people don't want them in rural areas or vice versa, it's just what comes down to your actual plan availability. And then lastly, based on income, this was a little bit more expected. We just talked a lot about how Medicare Advantage plans are often offered at no additional premium. And this is also shown in the data here. So, when looking at people that made less than $25,000 per year, they are more likely to skew towards Medicare Advantage enrollments versus people that make more than $25,000 per year that tend to enroll in Medigap plans. And again, that makes perfect sense when you think about the premiums between the two. All right now let's look at the Medicare Advantage versus Medigap plan takeaways when it comes to the data. Medicare Advantage plan growth is continuing to outpace Medigap growth, and we don't expect this trend to slow down anytime soon.

Cameron (22:27):

However, this does not mean that Medigap plans are not here to stay. As you can tell, their enrollments will continue to grow over the years. Now your choice of Medicare Advantage versus Medigap plan may come down to where you live and what plans are available to you. So don't have your mind set on one or the other until you actually compare specific options based on what's available in your county or zip code. And of course, although many people on social media will tell you that Medicare Advantage plans are evil and you should always stay away from them, just know that is simply not true and there is no one size fits all situation for everybody else as you've seen, Medicare Advantage plans would not be growing as they are.

Joanne (23:06):

So quick recap, for the entire episode, it could be helpful to see the trends of the national Medicare landscape as we talked about in this episode. But just remember that at the end of the day, your Medicare choices will be decided by what makes sense in your specific geographic location and more importantly your individual wants and needs as a Medicare beneficiary

Cameron (23:24):

And as always, please leave us a review on your podcast app and subscribe so you can listen to future episodes. You can also find more Medicare content from us by going to YouTube and searching Giardini Medicare. If you want to schedule a one-on-one phone call with one of our licensed agents, you can do so by going online to gmedicareteam.com. And if you want to send us any feedback or questions about today's episode, go, you can send us an email at info@gmedicareteam.com.