With the Medicare Annual Enrollment Period (AEP) now underway (October 15 to December 7), qualifying Medicare recipients have the option to alter their plans. According to information from insurance provider Humana, recipients can switch from Medicare Advantage plans (private-insurance products) to an Original Medicare plan (traditional government-provided coverage), or vice versa. They can also make changes to their prescription drug coverage, such as enrolling (or dis-enrolling) in a Part D plan.

The changes that consumers make will impact the health insurance industry moving forward. In particular, Medicare Advantage has seen an increase in enrollment year over year, climbing to 46% of all Medicare beneficiaries in 2022. What changes can insurance companies anticipate this year? Here’s what CivicScience data show:

Roughly 1 in 10 will make changes, Hispanic and Black Americans being more likely.

Ongoing polling of thousands of Medicare recipients (aged 65+) find that more than two-thirds plan to stick with their current Medicare insurance plan and carrier. Close to 1-in-10 plan to make some sort of change – 4% plan to switch insurance carriers entirely, while 5% will change their plan but retain their current carrier.

Expected changes aren’t the same across the population. Hispanic Americans and Black Americans are more likely than the general population to make changes – 14% of Hispanic Americans and 14% of Black Americans will switch either plans or insurance carriers. (White Americans align with the average at 9%.)

Compared to 2022, recipients are less likely to say they will stick with both their current plan and carrier (falling from 69% to 67% as of October 2023).

Medicare Advantage recipients are the most likely to drop insurance carriers or change plans.

A comparison of Medicare Advantage and Original Medicare (parts A and/or B) plan beneficiaries shows key differences in intent. A total of 11% of Medicare Advantage recipients look to make a change during the enrollment period, with the majority planning to stay with their insurance carrier but switch plans. Meanwhile, just 8% of people with an Original Medicare plan will do the same.

What’s driving people to make changes?

A separate poll addressed several known setbacks and challenges that consumers face when using Medicare. These include out-of-pocket costs, difficulty getting supplemental insurance (such as Medigap), changes to prescription drug coverage, and limitations to provider coverage.

Among those who have already changed or who plan to change their Medicare plan this year, 29% cite they are doing so primarily to lower costs, more than double the percentage of any other listed reason. However, adding or changing prescription coverage (13%), broadening their provider network (9%), and adding supplemental coverage (9%) also ranked.

It’s worth noting that 4-in-10 people planning to make changes cited ‘other’ reasons for doing so.

Additional data suggest that people planning to switch insurance carriers during this year’s AEP are significantly more likely to have some amount of medical debt compared to those just planning to switch insurance plans and those not planning to make any changes. A total of 35% of insurance carrier switchers have medical debt, of which more than half are carrying a balance of over $600.

Looking ahead, new enrollees are buying in with more debt.

While the AEP is available to those already enrolled with Medicare plans, it’s worth noting that incoming Medicare enrollees will enter the system carrying higher amounts of medical debt than current Medicare recipients. CivicScience data show that roughly 40% of people who plan to enroll this year or next year are carrying medical debt with them, compared to just 20% of those currently enrolled (n=1,691 responses on 10/25/2023). This debt burden could impact the plans and carriers that these new beneficiaries choose.

CivicScience regularly tracks the latest developments in healthcare. For more in-depth insights – and to see how insurance recipients differ across brands – get in touch.