1/3 Of Medicare Members Won’t Switch Plans, Despite Opportunities To Save, New Survey Shows

For Americans on Medicare, it’s open enrollment season, the period each year where you can switch your Medicare Advantage or stand-alone Medicare Part D prescription drug plan if you find something better. But many Medicare enrollees are potentially leaving better coverage on the table because they never shop around to see if better options are available.

According to new research released today from online private health insurance marketplace eHealth, 45% of Medicare beneficiaries have not reviewed their coverage options in the past year and 53% have had the same coverage for three or more years.

More people said they will review their coverage this year than have actually done so to date. In eHealth’s survey of more than 1,000 Medicare beneficiaries, two-thirds said they’re likely to review their coverage options for 2023 while one-third said they are not likely to review their coverage.

Bob Reese, vice president of Medicare sales at eHealth, recommends everyone review their coverage options during open enrollment.

“Too many Medicare beneficiaries think ‘My current plan worked fine last year, so I should just stick with it,’” Reese said.

In reality, few Medicare enrollees actually switch. A 2019 analysis showed that just 10% of people with stand-alone Medicare Part D prescription drug plans switched plans voluntarily during open enrollment, and even fewer (8%) people with Medicare Advantage prescription drug coverage switched by choice.

Nearly two-thirds (64%) of people surveyed knew that the Medicare open enrollment period is from October 15 through December 7, but that leaves more than one-third who think open enrollment happens at another time or don’t know when it is.

Forty percent of people enrolled in Medicare Advantage, Medicare Part D, or Medicare supplement plans don’t know if their benefits are changing in 2023.

In fact, the average monthly premium for 2023 Medicare Advantage plans dropped 8% in 2022 to $18 and new benefits and services are available from a number of plans. For example, 1,200 Medicare Advantage plans will be offering benefits designed to help people manage diseases and address non-medical barriers to care through the CMS Innovation Center’s Medicare Advantage Value-Based Insurance Design (VBID) Model. Additionally, 119 Medicare Advantage plans will offer increased access to palliative and integrated hospice care as part of the VBID Model’s Hospice Benefit Component.

In Medicare Part D, the number of available stand-alone prescription drug plans (PDPs) increased by 5% to 801. The average monthly premium for Part D coverage this year is projected to be $31.50, a modest drop from $32.08 in 2022.

“Many aren’t aware of how their coverage may change in January,” Reese said. “The best Medicare plan for your personal needs and budget might be different from one year to the next.”

Even if their plan’s rates or benefits don’t change, many people experience health or other changes that could cause their needs to change, which in turn would warrant a review of health plan options.

Nearly half (46%) said they have gotten a new prescription medication in the past year and 38% got a new diagnosis in the past year. Half (51%) said they have started seeing a new doctor or getting care at a new hospital, clinic, or pharmacy in the past year.

These factors could render their current plan—or even what type of Medicare plan they have—less appropriate or cost effective. For example, a new medication might not be covered or might be covered at a relatively high cost than it would be on another plan. Not all healthcare providers or pharmacies participate or are preferred in specific health plans and accessing care out-of-network or from non-preferred providers can be costly if it’s covered at all.

Beyond healthcare needs changing, many Medicare enrollees reported worrying about financial changes that could impact their ability to afford their care. Three-quarters (77%) of survey respondents reported being somewhat or very worried about the impact inflation could have on their healthcare costs. One-third (35%) of people surveyed said they cannot afford to pay any more than they already do. One-quarter (24%) said they couldn’t afford to pay more than 5% more in healthcare costs and another quarter said they couldn’t afford a 5 to 10% increase in healthcare costs.

People worried about rising costs may do well to revisit their Medicare options this open enrollment. According to a statement, eHealth estimates that comparing drug coverage options could identify a median of $552 in potential savings, based on company analysis.

All Medicare enrollees will have lower costs for Medicare Part B, the component of Medicare that covers doctor or clinic visits, some home health services, durable medical equipment, and other non-hospital services. In 2023, premiums will go from $170 per month to $164.90 and the annual deductible will drop from $233 in 2022 to $226 in 2023.

On the other hand, the deductible for Medicare Part A—the part of Medicare that covers hospitalizations, skilled nursing facilities, hospice, inpatient rehabilitation, and some home health services—will increase in 2023 to $1,600 from $1,556 in 2022. Most Medicare enrollees pay no premium for Part A.

Additionally, with the passage of the Inflation Reduction Act, people on Medicare will have their costs for insulin capped at $35 per month for anyone who gets their insulin pumps through the Part B durable medical equipment benefit.