Abstract
This cohort study examines switching behavior in enrollment in Medicare Advantage and traditional Medicare.
Introduction
The Medicare Advantage (MA) share of overall Medicare enrollment rose from 19% to 46% from 2007 to 2021 and is expected to exceed 50% by 2023.1,2 Growth was associated with new enrollees choosing MA and current enrollees in traditional Medicare (TM) switching to MA. Studies have documented higher rates of disenrollment from MA to TM among high-need beneficiaries.3,4,5 Disenrollment of such beneficiaries shifts financial risk from MA to the Medicare Trust Fund as they move from capitated to fee-for-service payments.6 With projections of Medicare Part A insolvency by 2026 and an increasingly diverse Medicare population,2 we examined recent switching behavior trends by demographic groups.
Methods
We assessed switching by demographic group, Medicare-Medicaid enrollment status (dual eligibility), and mortality status using the 2014 to 2020 Master Beneficiary Summary File Limited Data Sets from the US Centers for Medicare & Medicaid Services. The study population included current year enrollees in Medicare Parts A and B who were also enrolled during the previous year. The study was not subject to institutional review board approval and informed consent because it was conducted with Limited Data Sets data.
Beneficiaries were determined to have switched from TM to MA or vice versa if the enrollment type indicator in the Master Beneficiary Summary File at any point during the current year differed from their indicator during December of the previous year. We calculated switching rates from MA to TM as the percentage of MA enrollees from the previous year who were enrolled in TM at any point during the current year. Switching from TM to MA was similarly defined. We also estimated the proportion of new MA enrollment accounted for by switching from TM as the net number of switchers to MA divided by the total number of new MA enrollees.
The study followed the Strengthening the Reporting of Observational Studies in Epidemiology (STROBE) reporting guidelines for cohort studies. Data were analyzed in August 2022 using Stata, MP 16 (StataCorp). Additional details regarding methods are presented in the eMethods in Supplement 1.
Results
While switching rates from MA to TM exceeded those for TM to MA in 2016, this pattern was reversed from 2017 through 2020 (Table6). In 2020, TM-to-MA switching rates were almost 4 and 2.5 times higher than switching rates from MA to TM for Medicare only and Medicare-Medicaid enrollees, respectively. As a result, switching accounted for a growing share of new MA enrollment growth, increasing from 49% in 2016 to 67% in 2020.
Table. Medicare Enrollment Switching By Dual-Eligibility Status, Sex, and Age.
| Medicare switching by dual-eligibility status, % | ||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Period | All | Medicare-only beneficiaries | Medicare-Medicaid beneficiaries | |||||||||
| MA to TM | TM to MA | MA to TM | TM to MA | MA to TM | TM to MA | |||||||
| 2015-2016 | 4.6 | 4.1 | 3.8 | 3.5 | 8.2 | 6.8 | ||||||
| 2016-2017 | 3.7 | 5.3 | 3.0 | 4.7 | 6.9 | 8.1 | ||||||
| 2017-2018 | 3.3 | 5.7 | 2.5 | 5.1 | 8.6 | 9.4 | ||||||
| 2018-2019 | 3.5 | 6.0 | 3.0 | 5.3 | 7.3 | 10.1 | ||||||
| 2019-2020 | 2.0 | 6.8 | 1.6 | 6.1 | 4.5 | 11.2 | ||||||
| Medicare switching by sex, % | ||||||||||||
| Period | Medicare-only beneficiaries | Medicare-Medicaid beneficiaries | ||||||||||
| Male | Female | Male | Female | |||||||||
| MA to TM | TM to MA | MA to TM | TM to MA | MA to TM | TM to MA | MA to TM | TM to MA | |||||
| 2015-2016 | 3.8 | 3.7 | 3.8 | 3.4 | 8.9 | 6.3 | 7.9 | 6.6 | ||||
| 2016-2017 | 3.0 | 4.6 | 2.9 | 4.8 | 7.5 | 7.5 | 6.6 | 7.9 | ||||
| 2017-2018 | 2.6 | 5.0 | 2.5 | 5.1 | 9.4 | 8.4 | 8.2 | 9.2 | ||||
| 2018-2019 | 3.1 | 5.2 | 3.0 | 5.4 | 8.1 | 9.0 | 7.0 | 9.9 | ||||
| 2019-2020 | 1.7 | 6.2 | 1.6 | 6.1 | 4.8 | 10.1 | 4.3 | 10.8 | ||||
| Medicare switching by age, % | ||||||||||||
| Age group, y | Medicare-only beneficiaries | Medicare-Medicaid beneficiaries | ||||||||||
| 2015-2016 | 2019-2020 | 2015-2016 | 2019-2020 | |||||||||
| MA to TM | TM to MA | MA to TM | TM to MA | MA to TM | TM to MA | MA to TM | TM to MA | |||||
| <65 | 5.8 | 7.0 | 3.4 | 13.3 | 10.2 | 6.6 | 4.9 | 11.8 | ||||
| 65-69 | 4.1 | 4.6 | 1.8 | 7.8 | 7.2 | 10.0 | 3.9 | 16.5 | ||||
| 70-74 | 3.4 | 2.9 | 1.3 | 5.0 | 6.8 | 7.3 | 3.9 | 10.9 | ||||
| ≥75 | 3.3 | 2.2 | 1.2 | 3.9 | 7.4 | 5.2 | 4.6 | 7.4 | ||||
| Medicare switching by mortality status, % a , b | ||||||||||||
| Period | Medicare-only beneficiaries | Medicare-Medicaid beneficiaries | ||||||||||
| Beneficiaries in last year of life | Beneficiaries not in last year of life | Beneficiaries in last year of life | Beneficiaries not in last year of life | |||||||||
| MA to TM | TM to MA | MA to TM | TM to MA | MA to TM | TM to MA | MA to TM | TM to MA | |||||
| 2015-2016 | 4.5 | 2.3 | 3.9 | 3.7 | 9.2 | 3.5 | 8.5 | 7.4 | ||||
| 2016-2017 | 3.5 | 3.8 | 3.0 | 5.0 | 7.7 | 4.2 | 7.2 | 8.7 | ||||
| 2017-2018 | 2.9 | 3.8 | 2.6 | 5.3 | 9.2 | 5.4 | 9.1 | 10.3 | ||||
| 2018-2019 | 3.1 | 3.2 | 3.1 | 5.6 | 6.4 | 4.6 | 7.8 | 11.3 | ||||
| 2019-2020 | 2.2 | 4.3 | 1.7 | 6.5 | 7.3 | 8.3 | 4.6 | 12.5 | ||||
| Medicare beneficiary enrollment, No. | ||||||||||||
| Period | All | Medicare-only beneficiaries | Medicare-Medicaid beneficiaries | |||||||||
| TM | MA | TM | MA | TM | MA | |||||||
| 2015-2016 | 32 784 808 | 17 586 955 | 26 790 806 | 14 528 471 | 5 994 002 | 3 058 484 | ||||||
| 2016-2017 | 33 067 291 | 18 413 946 | 27 114 225 | 15 126 560 | 5 953 066 | 3 287 386 | ||||||
| 2017-2018 | 32 980 594 | 19 841 203 | 28 336 507 | 17 416 161 | 4 644 087 | 2 425 042 | ||||||
| 2018-2019 | 32 812 959 | 21 443 674 | 28 323 840 | 18 763 021 | 4 489 119 | 2 680 653 | ||||||
| 2019-2020 | 32 490 513 | 23 061 930 | 28 206 163 | 20 098 020 | 4 284 350 | 2 963 910 | ||||||
Abbreviations: GAO, General Accountability Office; MA, Medicare Advantage; TM, traditional Medicare.
Following the methods of the GAO6 report, we included beneficiaries in last-year-of-life cohort if they had died within 12 months of their switching choice. For beneficiaries who did not switch, we included in the last-year-of-life cohort if they had died by the end of the following calendar year.
The GAO6 report excludes approximately 30% of beneficiaries enrolled in MA in their computations (eg, those in MA contracts with fewer than 1000 enrollees, those who had more than 1 enrollment change during the calendar year, beneficiaries with end-stage kidney disease, and beneficiaries who used hospice services in the prior year). In comparison, we excluded beneficiaries with only Medicare Part A or Part B coverage or those with a diagnosis of end-stage kidney disease, as well as new Medicare beneficiaries (those who enrolled in the current calendar year).
While switching rates were not substantively different by sex, they generally declined with age (Table). Switching patterns by mortality status also changed materially (Table). In 2016, beneficiaries in their last year of life were more than twice as likely to disenroll from MA than from TM (5.4% vs 2.6%). By 2020, the trend had reversed (3.1% vs 5.1%).
Black and Hispanic beneficiaries generally switched at greater rates than White beneficiaries, and these differences have become more pronounced and were associated with the shift from TM to MA (Figure). By 2020, Black and Hispanic beneficiaries were more than twice as likely to disenroll from TM as White beneficiaries (13.4% and 13.5%, respectively, vs 5.9%). These switching patterns also persisted for beneficiaries during the last year of life.
Figure. Traditional Medicare (TM) and Medicare Advantage (MA) Switching Behavior by Race and Ethnicity of Enrollees.
Discussion
Medicare switching behavior has changed over time, with switching into MA accounting for a larger portion of MA enrollment growth. Switching may be associated with changes in health status, inclusion of additional services in MA, cost considerations, and access to specialized health care clinicians.3 The observed trends may reflect a growing importance of access to non-TM benefits in MA, cost considerations among beneficiaries, and divergence in the enrollment preferences of Black and Hispanic beneficiaries compared with White beneficiaries. The study did not attempt to estimate the individual effects or causal relationship between beneficiary characteristics and switching behavior. Future work to explore these associations is warranted.
This study’s findings on the evolving MA-to-TM switching rate in the last year of life suggest that prior research, which showed increased spending in association with this switch, may have overstated its association with future Medicare spending.6 Black and Hispanic beneficiaries in this cohort had higher disenrollment rates from TM, suggesting that these groups are an important source of the changing financial implications.
eMethods.
Data sharing statement
References
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Associated Data
This section collects any data citations, data availability statements, or supplementary materials included in this article.
Supplementary Materials
eMethods.
Data sharing statement
