According to a Kaiser Family Foundation page, “Medigap Reform: setting the Context for Understanding Recent Proposals,” the vast majority of Medicare beneficiaries enhance their Medicare benefits with some other kind of coverage. Even though Part A and Part B offer very broad coverage, it is no secret that there are gaps because of deductibles, copays, coinsurance, and things that Medicare does not pay for at all. People who are interested in buying Medicare insurance from private companies to enhance their own benefits might be interested in learning what other beneficiaries do to make the most of their health benefits.
Medicare Advantage and Medigap Quick Facts
These are some figures from 2014 to 2015 for Medicare Advantage (MA) enrollment that were provided by the Kaiser Family Foundation (KFF):
- Percentage of Medicare recipients who join Medicare Advantage: 31 percent
- Number of MA members with a local HMO: 10,346,819
- Number of MA members with a local PPO: 3,960,546
- Number of MA members with a regional PPO: 1,218,254
CMS predicts that Medicare Advantage may get even more popular. HMOs might be the most popular because they tend to do the best job of controlling costs both for recipients and insurance companies. On the other hand, PPOs offer more flexibility, so some recipients are likely to pay more for the ability to have more choices.
Of course, Medigap policies have not totally gone out of style. About one in four beneficiaries have chosen a supplement pretty consistently through the years. The number has decreased slightly as more people join Medicare Advantage. Of the different supplement levels, Plan F and C are the most popular. This is true even though they are typically the most expensive. It seems that people who buy supplements may be less concerned about premiums than other factors.
Not everybody needs a supplement or Medicare Advantage plan. Some folks have other types of public health insurance, like Medicaid or Veterans benefits, so they don’t need Medigap or Medicare Advantage. Others still have job-based health insurance.
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