RUPRI Center for Rural Health Policy Analysis Rural Policy Brief Brief No. 2020-8 OCTOBER 2020 http://www. public-health.uiowa.edu/rupri/ Medicare Advantage Enrollment Update 2019 Abdinasir K. Ali, MPH; Fred Ullrich, BA; and Keith Mueller, PhD Background and Purpose This policy brief continues the RUPRI Center's annual series of Medicare Advantage (MA) enrollment updates. In addition to tracking overall and metropolitan/nonmetropolitan enrollment, this brief also reports on changes in enrollment in types of MA plans. The Center's ongoing line of inquiry also considers policy changes from previous years that may have impacted MA plan enrollment. Key Findings e MA enrollment has grown steadily for more than 10 years, but in both 2018 and 2019 the growth in proportion of nonmetropolitan county enrollment (1.1 percent and 1.0 percent, respectively) has outpaced that of metropolitan county enrollment (0.7 percent and 0.6 percent, respectively). e Local preferred provider organization (PPO) plans held the highest share of MA enrollment (45.2 percent) in nonmetropolitan counties. They were also the only type of plan to see significant growth in proportion of metropolitan MA enrollees since 2009 (from 8.1 percent to 29.0 percent). e Nonmetropolitan enrollment in health maintenance organization (HMO) plans has grown steadily as a share of total MA enrollment since 2009 and accounted for 32.7 percent of that population's MA participation in 2019. The share of enrollment in HMO plans is much higher in metropolitan counties (65.0 percent in 2019), but the rate of growth in that population's enrollment has been nearly flat since 2009. Methods Monthly MA enrollment data for March 2019 were downloaded from Centers for Medicare & Medicaid Services (CMS) web sites. March enrollment data are used in this series of annual updates because it is the first month after open enrollment closes each year and reflects net enrollment each year. Metropolitan/nonmetropolitan designations (based on Urban Influence Code) were used because data were reported by county. The terms rura/ and nonmetropolitan are used interchangeably in this brief. Results / Findings As of March 2019, 22.0 million Medicare beneficiaries were enrolled in MA plans, representing 35.0 percent of all Medicare beneficiaries (Figure 1). Between 2018 and 2019, total MA rUusOr i] Rural Health Research & Policy Centers Funded by the Federal Office of Rural Health Policy RURAL POLICY RESEARCH INSTITUTE www.ruralheafthresearch,org RUPRI Center for Rural Health Policy Analysis, This project was supported by the Federal Office of Rural Health University of Iowa College of Public Health, Policy (FORHP), Health Resources and Services Administration Department of Health Management and Policy, (HRSA), U.S. Department of Health and Human Services (HHS) 145 Riverside Dr., Iowa City, IA 52242-2007, under cooperative agreement/grant 1U1GRH07633. The (319) 384-3830 ; information, conclusions and opinions expressed in this policy brief http://www. public-health. uiowa.edu/rupri are those of the authors and no endorsement by FORHP, HRSA, or E-mail: cph-rupri-inquiries@uiowa.edu HHS is intended or should be inferred. enrollment grew by 1.5 million beneficiaries, representing an increase of 7.5 percent. A higher proportion of metropolitan Medicare beneficiaries than nonmetropolitan beneficiaries (37.0 percent and 25.6 percent, respectively) enrolled in MA for 2019. But in both 2018 and 2019, the proportion of nonmetropolitan beneficiaries enrolled in MA increased (1.1 and 1.0 percentage points, respectively) more than metropolitan beneficiaries (0.7 and 0.6 percentage points, respectively). The patterns of MA plan type enrollment in metropolitan and nonmetropolitan counties is very different. Well over half (65.0 percent) of metropolitan MA enrollees are in HMO plans whereas the largest portion (45.2 percent) of nonmetropolitan MA enrollees are in local PPO plans (Tables 1a, 1b, 1c). Metropolitan HMO plan enrollment growth has been largely flat since 2009 (the earliest data in this report) while nonmetropolitan growth in these plans has increased in 9 of 11 years, from 20.9 percent to 32.7 percent. Both metropolitan and nonmetropolitan growth in enrollment in local PPO plans has occurred nearly every year since 2009. Enrollment in other plan types (regional PPO, private fee-for-service [PFFS], and other) has declined for the last three years or longer. National and state-specific maps and tables of MA enrollment can be found at http://ruprihealth.org/maupdates/nstablesmaps.html Figure 1. Medicare Advantage Enrollment, March 2009-March 2019 Nonmet./ Count Pct. Year Metro. (x1,000) | Enroll. Nonmet. 2,874 | 25.6% 2019 | Metro. 19,190 | 37.0% 2M N Ml 37.0% Total 22,064 | 35.0% 35.0% Nonmet. 2,639 | 24.6% 2018 | Metro. 17,889 | 36.4% ¢ 26M 36.4% Total 20,529 | 34.3% 34.3% Nonmet. 2,410 | 23.5% 7 23.5% 2017 | Metro. 16,641 | 35.7% Toam.SOS~CS en 35.7% Total 19,050 | 33.5% Nonmet. 2,225 | 22.1% 2016 | Metro. 15,423 | 34.1% | | #6 22m 34.1% Total 17,648 | 31.9% Nonmet. 2,115 | 21.6% 2015 | Metro. 14,619 | 33.5% Total 16,733 | 31.3% Nonmet. 1,966 | 20.5% 2014 | Metro. 13,456 | 31.7% Total 15,422 | 29.7% Nonmet. 1,753 | 18.6% 2013 | Metro. 12,339 | 30.0% Total 14,093 | 27.9% Nonmet. 1,559 | 17.0% 2012 | Metro. 11,304 | 28.6% Total 12,863 | 26.4% Nonmet. 1,394 | 15.6% 2011 | Metro. 10,359 | 27.2% Total 11,753 | 25.0% Nonmet. 1,300 | 14.8% 2010 | Metro. 9,744 | 26.3% | [eqam ome 26.3% Total 11,044 | 24.1% | | CL] Total oO Metro. Nonmet. 1,222 | 14.1% oO Nonmetro. 2009 | Metro. 9,224 | 25.5% Total Total 10,446 | 23.3% Neto. I onmetro. 0% 10% 20% 30% 40% Source: RUPRI Center for Rural Health Policy Analysis, analysis of Centers for Medicare & Medicaid Services' Medicare Advantage enrollment data. Figure 2. Medicare Advantage Enrollment, by Plan Type*, March 2009-March 2019 Nonmetropolitan Metropolitan 100 - c © £ ° 80 - c ui © D & Cc 60 - © > s < © Ss 40- 3 © = - ° 5 20- 2 o oO 0-4 | | | q | | q | q | q 1 | | | | | | | ! | ! 99.9.9.9.9.9.9.9.92 H.9.9.9.9.9.9.9.9.9.2 [057507505 Oy <0, 0;07°0,50,°0p. "Qp°O7°0,°0,50,°0,°0;°0/°0,507°Oy, Year M™ HMOs H Local PPOs & Regional PPOs Mi PFFS plans @ Other © Unattributed Source: RUPRI Center for Rural Health Policy Analysis, analysis of Centers for Medicare & Medicaid Services' Medicare Advantage enrollment data. * 'Other' plans include 1876 Cost, HCPP - 1833 Cost, and National PACE plans. 'Unattributed' refers to beneficiaries that could not be assigned to a plan type because of CMS reporting restrictions on county/plans with 10 or fewer enrollees. Table 1a. Overall Medicare Advantage Enrollment by Plan Type*, March 2009-March 2019 Total MA % Total Local Regional PFFS Year Enrollees Enrolled HMO PPO PPO Plan Other Unatt. 2009 | 10,445,905 23.3% 61.3% 7.9% 3.6% 22.1% 3.7% 1.3% 2010 | 11,043,656 24.1% 62.1% 11.2% 7.0% 14.5% 3.9% 1.4% 2011 | 11,752,518 25.0% 62.8% 17.7% 9.6% 4.9% 4.0% 1.0% 2012 | 12,863,257 26.4% 62.6% 21.4% 7.2% 3.9% 4.0% 0.9% 2013 | 14,092,553 27.9% 63.2% 22.1% 7.5% 2.9% 3.6% 0.7% 2014 | 15,421,808 29.7% 62.3% 23.6% 7.9% 2.0% 3.6% 0.6% 2015 | 16,733,384 31.3% 62.9% 23.9% 7.4% 1.5% 3.8% 0.6% 2016 | 17,647,860 31.9% 63.5% 23.5% 7.4% 1.3% 3.8% 0.5% 2017 | 19,050,353 33.5% 61.8% 25.9% 7.1% 1.0% 3.8% 0.5% 2018 | 20,528,576 34.3% 61.1% 27.6% 6.4% 0.7% 3.6% 0.5% 2019 | 22,063,990 35.0% 60.8% 31.1% 5.6% 0.5% 1.4% 0.5% Table 1b. Nonmetropolitan Medicare Advantage Enrollment by Plan Type, March 2009-2019 Total MA % Total Local Regional PFFS Year Enrollees Enrolled HMO PPO PPO Plan Other Unatt. 2009 | 1,222,259 14.1% 20.9% 6.8% 7.3% 54.5% 5.9% 4.6% 2010 | 1,299,589 14.8% 23.6% 13.1% 14.0% 37.9% 6.8% 4.6% 2011 | 1,393,984 15.6% 26.1% 25.8% 20.0% 17.0% 7.9% 3.2% 2012 | 1,559,261 17.0% 26.8% 31.6% 16.7% 14.1% 7.9% 2.9% 2013 | 1,753,427 18.6% 28.0% 34.1% 17.4% 10.4% 7.8% 2.3% 2014 | 1,966,261 20.5% 27.9% 37.0% 18.5% 6.8% 7.8% 1.9% 2015 | 2,114,836 21.6% 28.5% 38.6% 17.2% 5.6% 8.4% 1.7% 2016 | 2,225,321 22.1% 29.9% 37.3% 17.5% 5.0% 8.6% 1.6% 2017 | 2,409,502 23.5% 29.8% 38.5% 17.7% 3.8% 8.8% 1.5% 2018 | 2,639,354 24.6% 30.4% 40.5% 16.4% 2.9% 8.3% 1.4% 2019 | 2,874,083 25.6% 32.7% 45.2% 14.6% 2.0% 4.1% 1.3% Table 1c. Metropolitan Medicare Advantage Enrollment by Plan Type, March 2009- 2019, Metropolitan Total MA % Total Local Regional PFFS Year Enrollees Enrolled HMO PPO PPO Plan Other Unatt. 2009 | 9,223,646 25.5% 66.7% 8.1% 3.2% 17.8% 3.5% 0.8% 2010 | 9,744,067 26.3% 67.2% 10.9% 6.0% 11.4% 3.5% 0.9% 2011 | 10,358,534 27.2% 67.7% 16.6% 8.2% 3.3% 3.5% 0.8% 2012 | 11,303,996 28.6% 67.6% 20.0% 5.9% 2.5% 3.4% 0.6% 2013 | 12,339,126 30.0% 68.3% 20.4% 6.1% 1.8% 3.0% 0.5% 2014 | 13,455,547 31.7% 67.3% 21.7% 6.4% 1.3% 3.0% 0.4% 2015 | 14,618,548 33.5% 67.9% 21.8% 5.9% 0.9% 3.1% 0.4% 2016 | 15,422,539 34.1% 68.3% 21.5% 6.0% 0.8% 3.1% 0.4% 2017 | 16,640,851 35.7% 66.4% 24.1% 5.5% 0.6% 3.1% 0.4% 2018 | 17,889,222 36.4% 65.6% 25.7% 4.9% 0.4% 2.9% 0.4% 2019 | 19,189,907 37.0% 65.0% 29.0% 4.3% 0.3% 1.0% 0.3% Source: RUPRI Center for Rural Health Policy Analysis, analysis of Centers for Medicare & Medicaid Services' Medicare Advantage enrollment data. * 'Other' plans include 1876 Cost, HCPP - 1833 Cost, and National PACE plans. 'Unattributed' refers to beneficiaries that could not be assigned to a plan type because of CMS reporting restrictions on county/plans with 10 or fewer enrollees. Discussion Overall enrollment in MA plans grew by 7.5 percent between 2018 and 2019, with similar growth in both metropolitan (7.3 percent) and nonmetropolitan (8.9 percent) counties. This sustained growth stands in contrast to expectations following changes to the MA program imposed by the Patient Protection and Affordable Care Act (PPACA) in 2010. In an attempt to control MA costs, the PPACA introduced a number of modifications to the program, including changing payment rate calculations and lowering rebate amounts.? By reducing the payments to insurers, these policy changes were expected to decrease supplemental benefits while increasing cost sharing, ultimately making plans less attractive to beneficiaries.? However, enrollment in MA continues to grow, with the Congressional Budget Office estimating that 42 percent of all Medicare beneficiaries will be in MA plans by 2027.4 A number of factors have been cited for mitigating the impact of the PPACA changes on MA enrollment including quality bonus payments established by the PPACA helping to offset payment rate cuts, the slow phase-in of rate cuts, modest changes in rebate reductions and others®. In fact, the MA market now appears stronger than ever, with the Medicare Payment Advisory Commission (MedPAC) announcing that as of 2019, "nearly all Medicare beneficiaries (97 percent) have an HMO or local PPO operating in their county of residence."® 4 Early analysis of the MA landscape shows that in 2020, Medicare beneficiaries will have access to an average of 28 MA plans for individual enrollment. However, the access landscape will be somewhat uneven as metropolitan beneficiaries will have access to nearly twice as many plans as nonmetropolitan beneficiaries (31 plans versus 16 plans, respectively). 7 Several changes to the MA landscape over the last year are likely to prolong or enhance growing enrollment: e CMS policy updates announced in April 2019 expand the range of possible supplemental benefits to include those addressing social determinants of health for beneficiaries with chronic disease. Examples include meal delivery in more circumstances, transportation for nonmedical needs such as grocery shopping, and carpet-cleaning to reduce irritants for beneficiaries with asthma®. The update also authorized greater use of telehealth than permitted in traditional Medicare. e CMS''s steps to enhance marketing for MA plans will also likely continue the growth in MA enrollment. In the past two years, CMS has loosened restrictions on marketing MA plans by streamlining government review and approval of marketing materials and by launching an overhauled "plan finder" that allows users to shop and compare MA and Part D plans. ? e Another change likely to enhance the attractiveness of MA is a provision in the Medicare Access and CHIP Reauthorization Act of 2015 (MACRA) that removed the two most popular Medigap plans from the list of those available to new traditional Medicare enrollees in 2020. The loss of these Medigap plans will likely make traditional Medicare a less attractive alternative to new beneficiaries. ?° It is unclear whether any of these changes will have a differential impact on MA enrollment in nonmetropolitan and metropolitan areas. RUPRI will continue to monitor changes and trends in MA enrollment. References 1U.S Centers for Medicare and Medicaid Services. (2019). Monthly MA Enrollment by State/County/Contract. Retrieved from CMS.gov: https://www.cms.gov/Research-Statistics-Data-and-Systems/Statistics-Trends-and- Reports/MCRAdvPartDEnrolData/Monthly-MA-Enrollment-by-State-County-Contract 2 Skopec, L., Zukerman, S., Allen, E., & Aarons, J. (2019). Why Did Medicare Advantage Enrollment Grow As Payment Pressure Increased? Washington: Urban Institute. 3 Nicholas, L. (2014). Will Medicare Advantage Benchmark Reforms Impact Plan Rebates and Enrollment? The American Journal of Managed Care, 20(11): 917-24. 4 Jacobson, G., Freed, M., Damico, A., & Neuman, T. (2019). A dozen Facts About Medicare Advantage in 2019. Retrieved September 13, 2019, from Kaiser Family Foundation: https://www.kff.org/medicare/issue-brief/a-dozen- facts-about-medicare-advantage-in-2019/ > Skopec, L., Zukerman, S., Allen, E., & Aarons, J. (2019). Why Did Medicare Advantage Enrollment Grow As Payment Pressure Increased? Washington: Urban Institute © Medpac. (2019). Medicare Payment Policy. Washington, DC: Medicare Payment Advisory Commission. 7 Jacobson, G., Freed, M., Damico, A., & Neuman, T. (2019). Medicare Advantage 2020 Spotlight: First Look. Retrieved December 12, 2019 from http://files.kff.org/attachment/Data-Note-Medicare-Advantage-2020-Spotlight-First-Look 8 Karen, A., & Ceballos, K. (2019). CMS Finalizes Medicare Advantage and Part D Payment and Policy Updates to Maximize Competition and Coverage. Retrieved December 12, 2019 from https://www.cms.gov/newsroom/press- releases/cms-finalizes-medicare-advantage-and-part-d-payment-and-policy-updates-maximize-competition-and 3 Aldana, K., & Ceballos, K. (2019). Trump Administration Drives Down Medicare Advantage and Part D Premiums for Seniors. Retrieved December 12, 2019 from https://www.cms.gov/newsroom/press-releases/trump-administration- drives-down-medicare-advantage-and-part-d-premiums-seniors 10 Adelberg, M., & Rodriguez, K. (2019). Medicare Advantage is nudging aside "old Medicare' with free ride, a warm meal, and a handyman. Retrieved December 12, 2019 from https://www.statnews.com/2019/04/03/medicare- advantage-nudging-aside-old-medicare/