Survey Says: The Sky’s the Limit for Medicare & Medicare Advantage Growth
With 11,000 baby boomers turning 65 every day, it’s no wonder health plans are growing their Medicare Advantage business faster than traditional Medicare. In addition to turning to sales and marketing to grow this line of business, health plans are also considering the impact that value-based reimbursements and social determinants of health (SDOH) may have on this member population. To learn more about how payers are approaching this potential growth opportunity, HealthEdge and independent research firm Survata recently surveyed over 200 health plan executives working in the Medicare and/or Medicare Advantage areas.
HealthEdge’s survey results underpin the trendlines being reported from CMS. CMS projects that Medicare enrollment will grow from 59.3 million in 2018 to 72 million in 2025. On the Medicare Advantage front, enrollment surpassed 22 million in 2018, or 35 percent of all Medicare beneficiaries. L.E.K Consultants expect this number to grow by 7.7 percent annually and reach 47 percent penetration by 2025, or $350 billion in market potential.
In pursuit of the elusive triple aim in healthcare, Medicare Advantage appears to be one of the rare insurance products hits all the marks. It improves the experience of care and consistently receives high consumer satisfaction scores. It manages the health of the population through comprehensive, coordinated care delivery. And it lowers costs by reducing fee-for-service contracts and buying into the value-based reimbursement philosophy. Medicare Advantage is also starting to approach the quadruple aim of a better provider experience by giving providers the incentives, tools and workflows required to support a value-based care delivery system.
But Medicare and Medicare Advantage are not without their own challenges. As we move into the third decade of the 21st century, health plans must keep pace with today’s tech-savvy baby boomers. An Accenture study found that 42 percent of baby boomers prefer to shop for coverage online, and this trend is only likely to grow as younger, even more tech-savvy generations age.
Bottom line: The rate of Medicare and Medicare Advantage growth will only accelerate in the coming years. The pressure from consumers to digitize and modernize health insurance and care delivery will continue. Savvy health insurers will either rise to the occasion to attract and retain these members, thereby capitalizing on the enormous market opportunity available, or be left behind.
Medicare Advantage growth represents over $360 billion in market potential. But without a strong growth strategy and a technology infrastructure that supports expansion, health plans will not be able to keep up with the demand presented by baby boomers aging into Medicare. Download the report to learn how leading insurers are growing Medicare Advantage lines of business faster than traditional Medicare.
This latest “Voice of the Market” survey was commissioned by HealthEdge and conducted by Survata, an independent research firm, in June 2019. Survata interviewed 201 health insurance executives who work in the Medicare or Medicare Advantage lines of business.