- Medicare Advantage is growing rapidly in rural communities, where 40% of eligible beneficiaries chose the privatized version of the insurance program for seniors in 2023, according to a report by KFF. In 2010, only 11% of enrollees opted for MA.
- On average, MA beneficiaries in rural areas could pick from 27 plans, triple the number of plans offered compared to 2018.
- Despite the quick adoption of MA, enrollment is still lower in rural areas compared to more populous regions. Fewer marketing and outreach investments or lower financial returns in smaller communities could be to blame, according to researchers.
Under MA, private insurers receive a set amount from the government to manage care for beneficiaries, who are largely seniors. The program has grown significantly over the past decade, with more than half of eligible Medicare beneficiaries enrolled in MA this year.
The private plans often include supplemental benefits, including some coverage of dental, vision and hearing care. But MA plans can also use limited provider networks, which could be an additional challenge for rural beneficiaries who usually have to travel farther for care.
Medicare Advantage enrollment grows rapidly in rural counties
Despite growth in rural areas, larger shares of people eligible for Medicare picked MA plans in more populated regions. In micropolitan areas, or counties with populations between 10,000 to 50,000 people, 44% opted for MA, while 53% of those in metropolitan areas, or counties with at least 50,000 residents, chose MA plans.
The number of plans available to rural beneficiaries grew at a similar rate in micropolitan counties, where an average of 31 plans were available this year compared with 11 in 2018.
But metropolitan enrollees have the most choices, with an average of 46 plans in 2023, over double what was offered in 2018.
The average rural beneficiary can pick from plans offered by six insurers in 2023, double the number of firms offering plans in their communities five years ago.
Beneficiaries in both rural and micropolitan areas are more likely to have a plan that requires an additional premium. Sixty-nine percent of enrollees in rural communities have a plan that requires no premium other than a Part B premium, compared with 66% in micropolitan areas and 75% in metropolitan counties.
As enrollment grows in the U.S., researchers and regulators have sounded the alarm about overpayments to MA plans, which they argue threaten the financial stability of the Medicare system.
Researchers from the USC Schaeffer Center for Health Policy and Economics estimated overpayments could reach more than $75 billion this year due to favorable selection of healthier beneficiaries, more aggressive coding and quality bonuses.
The CMS has moved to claw back billions of dollars of overpayments to MA plans. Humana, one of the nation’s largest MA insurers, sued the HHS last week over the audits, arguing the “arbitrary and capricious” and should be vacated.
Regulators have also taken steps to crack down on routine prior authorization denials and misleading marketing among MA plans.