Fewer consumers selected $0 premium Medicare Advantage plans in 2023 compared to last year, new research from health insurance marketplace eHealth shows.
In 2023’s enrollment period, 84% of eHealth customers chose an MA plan with a $0 monthly premium, versus 87% in 2022, eHealth’s annual Medicare Index Report found. This is the first time popularity in $0 premium plans has decreased since eHealth started conducting the report in 2018, when 63% of customers selected a no-premium plan.
“The widespread availability of $0-premium Medicare Advantage plans was a major enrollment driver over the past decade. The avoidance of a monthly premium, coupled with the enriched benefits and value proposition relative to original Medicare has made these plans popular, particularly with seniors on a fixed budget,” said eHealth CEO Fran Soistman in a news release. “Our findings suggest the market may be fully saturated with zero-dollar premium plans, with more beneficiaries selecting Medicare Advantage premium-bearing plans that provide lower out-of-pocket costs.”
The eHealth report, published last week, analyzed more than 160,000 applications for Medicare insurance products received by eHealth between October 15 and December 7 (the 2023 enrollment period). The Santa Clara, California-based company offers Medicare Advantage, Medicare Supplement, Medicare Part D, individual, family, small business and ancillary plans from about 200 health insurers.
It also found that the average monthly premium for Medicare Advantage plans was $9 in 2023, a 50% increase from $6 in 2022. This is the second year in a row that eHealth found an increase in average monthly premiums for Medicare Advantage plans. However, this is still considered quite low due to $0 premium plans, eHealth said in the report.
Medicare Part D plans saw an increase in average monthly premiums as well. In 2023, the average monthly premium for Medicare Part D plans was $32 a month compared to $22 a month last year, representing a 45% increase. This is also the second year in a row there has been an increase, and it’s the highest the average premium has been since 2018, partially due to “coverage of new costly drugs,” eHealth said.
Medicare Supplement average premiums decreased for the first time since 2018, however, to $173 per month in 2023 from $178 in 2022. In 2018, the average monthly premium was $142.
Average deductibles also fell for Medicare Advantage and Part D plans, though not for Medicare Supplement plans. In 2023, the average deductible was $103 for Medicare Advantage plans, $389 for Medicare Part D plans and $241 for Medicare Supplement plans. In 2022, the average deductible was $121, $427 and $181, respectively.
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