The Future of Medicare Advantage
Posted: February 2023
I was recently honored to be among the keynoters at the 2023 RISE Medicare Marketing and Sales Summit in Las Vegas. The invitation to share my thoughts on the opportunities and challenges of the Medicare Advantage environment at this extraordinary conference sponsored by the RISE team is most appreciated.
The continued strong growth of the Medicare Advantage enrolled base is a testament to the tremendous value Medicare Advantage plans provide its members. Medicare Advantage enrollment crossed the thirty million member threshold in January and is now nearly forty-seven percent of the Medicare Beneficiary population. With an expectation that the Beneficiary base will grow to more than seventy million by the end of the decade, the opportunity for continued growth remains strong.
As we assess the political and regulatory environments, it appears that regulatory action is considerably more likely than any legislative solutions. While there are some potential areas of legislative agreement, such as mental health access and telehealth expansion, we do not envision any major Medicare related legislation given the divided congress.
CMS on the other hand appears poised to be very active on several key issues. These include increased focus on health equity, addressing real and perceived market abuses, and real attention to auditing risk scores and validating associated payment to plans. This last issue has significant potential for disruption in the market and will undoubtedly be the source of much litigation.
Though we are bullish on the opportunities ahead for Medicare Advantage plans, there several areas where serious challenges are likely. It is clearly becoming more difficult to differentiate plans in the marketplace. Benefit structures, provider networks and even premiums are increasingly similar among the average thirty plus or more plan offerings in most markets. If there becomes serious revenue pressures as expected from lower star ratings, this will markedly increase challenges associated with maintaining market positions. Adding to plan challenges will be the role of market disruptors such as Amazon, Apple and Walmart who are actively entering our space.
If you wish to view and discuss the slides used in this presentation, I’d be pleased to share these with you and have a conversation about the likely future environment for Medicare Advantage. Please send me a message here.
Managing Partner, Strategic Health Group