Older adults often caught in Medicare switching cycle

Patients switch Medicare plans regularly: ©Zimmytws - stock.adobe.com

Medicare’s Open Enrollment period means millions of older adults and people with disabilities face a choice of either remaining with their current Medicare plan or switching to a new option. A study from the University of Michigan found a key pattern: people who switch between Medicare Advantage (MA) plans and traditional Medicare are likely to switch again.

The research found that around 3% of people with traditional Medicare switch to an MA plan annually. However, those who had switched from MA to traditional Medicare within the last three years were more than twice as likely to switch back, with 6.5% returning to MA plans. In fact, 9% of those who left MA for traditional Medicare returned to MA just one year later.

Geoffrey Hoffman, PhD, the study’s lead author and associate professor at the University of Michigan School of Nursing, noted the significance of these patterns for health care policy. "Medicare Advantage plans now cover more than half of all Americans with Medicare," Hoffman said in a statement. "It's important to understand that leaving Medicare Advantage doesn't mean permanent dissatisfaction. We need to explore what drives these multiple switches."

Many beneficiaries choose traditional Medicare for its broader network of doctors and hospitals, especially if they develop serious health conditions. Yet the study found no major differences in switching behavior among people with Alzheimer’s disease or chronic conditions, suggesting other factors might be at play.

One key issue could be the lack of access to Medigap plans, which help cover out-of-pocket costs under traditional Medicare. Most states don't guarantee access to Medigap after the initial enrollment period, making it challenging for some to stay with traditional Medicare long-term. However, even in states without Medigap guarantees, no significant differences in switching patterns were observed among those with Alzheimer’s.

The study also highlighted that people who return to Medicare Advantage often choose higher-rated plans or those with broader provider networks, indicating that they may be acting as informed consumers. Still, the frequent switching between plans adds administrative costs for both insurers and the federal government, not to mention the time and effort required from beneficiaries and caregivers.

With a vast array of Medicare Advantage options and complex factors to consider, Hoffman said beneficiaries should carefully evaluate total costs, not just premiums, when deciding whether to switch. Checking provider networks and understanding state policies on Medigap guarantees are also crucial for those contemplating a move back to traditional Medicare.

The researchers said that as Open Enrollment progresses, doctors can help their patients navigate these complex decisions by ensuring they are aware of their options and the potential challenges of switching between Medicare plans.