Trust, numerous options drive Medicare Advantage plan growth, study finds

Trust and the large number of plan options have helped make Medicare Advantage plans the fastest growing segment of the health insurance market, according to the J.D. Power 2023 U.S. Medicare Advantage Study.

There are many reasons Medicare Advantage plans are growing so quickly. First, JD Power’s research demonstrates that, overall, there are high levels of member trust with Medicare Advantage plans, in general, explained JD Power’s managing director, global healthcare intelligence, Christopher Lis. Trust is a key driver of overall satisfaction for health plans, with the top performing plans scoring higher in member trust, he said, adding that the ability to resolve problems or complaints is also a leading factor in retention.

Second, this year, Lis added, “we are seeing the largest number of Medicare Advantage plan options ever available in the marketplace, with the average Medicare beneficiary having access to over 40 plans. Many of these plans often offer more comprehensive coverage, as compared to traditional Medicare.”

Additionally, many Medicare Advantage plans have extra benefits not covered by traditional Medicare, including transportation support, health and wellness, and additional benefits. And finally, he said, high-performing Medicare Advantage plans and Medicare Advantage provider networks can offer more seamless care coordination than other options, with some evidence suggesting higher quality care, service, and patient outcomes, among the top performers. All of these factors have contributed to Medicare Advantage plans growth.

Medicare Advantage plans growth findings

Other major findings contributing to the Medicare Advantage plans growth identified in the survey include:

• Overall satisfaction with Medicare Advantage plans is generally good: Overall customer satisfaction with Medicare Advantage plans is 652 (on a 1,000-point scale), which is squarely in the good-to-great range of the newly redesigned U.S. Medicare Advantage Study index model. Plans perform highest on trust, ease of doing business and meeting member product/coverage needs.
• Trust and problem resolution hold keys to customer loyalty: Level of trust and resolving problems or complaints are the most highly correlated factors associated with members renewing their health plan. Satisfaction with trust increases 353 points among those likely to renew with their health plan compared with those who are unlikely to renew. Similarly, satisfaction with problem resolution increases 351 points among those likely to renew.
• Ease of finding care and digital tools are now the biggest pain points: Just 31% of Medicare Advantage plan members say their plan made it easy for them to find care and just 34% say they used two or more digital tools offered by their plan. Overall customer satisfaction scores are 158 points higher, on average, when members say it is easy to find care and 62 points higher, on average, when members use two or more digital tools.
• Health-plan ratings and customer reviews spur customer satisfaction: The most effective sources of information about Medicare Advantage plans are health plan ratings, information received directly from the plan itself and recommendations from friends, relatives and co-workers.

Implications for agents and brokers

So, what are some of the findings’ implications for agents and brokers selling Medicare Advantage plans? While agents and brokers are the leading source by which consumers obtain information about Medicare Advantage, consumers who obtain information from health plan rating sources have the highest level of overall satisfaction with their plan, which may mean that health plan ratings are correlated with a better overall patient experience, explained Lis.

Similarly, he said, “agents and brokers may want to leverage health plan ratings information into their consumer discussions, as part of the dialogue to help consumers make informed choices.”

Lis also shared some ideas agents and brokers can use to build and enhance their level of trust with clients. Agents and brokers remain a critical resource by which consumers obtain information about Medicare Advantage plan options, he pointed out. Trust can be enhanced, he added, with full transparency and aligning consumer expectations to plan costs and benefits.

“Online plan comparison tools, and health plan ratings can be an important supplement to gaining transparency on member experience, among other key performance indicators,” he added.

Company rankings

In addition to these findings, the survey ranked companies on overall customer satisfaction:
SCAN Health Plan ranks the highest in overall customer satisfaction with Medicare Advantage plans in California, with a score of 708. Humana (692) ranks second and Kaiser Foundation Health Plan (680) ranks third. Humana ranks the highest in overall satisfaction with Medicare Advantage plans in Florida, with a score of 670. UnitedHealthcare (653) ranks second and Aetna (647) ranks third.

Excellus BlueCross BlueShield ranks highest in overall satisfaction with Medicare Advantage plans in New York, with a score of 700. Healthfirst (680) ranks second and Humana (651) ranks third. UPMC For Life ranks highest in overall satisfaction with Medicare Advantage plans in Pennsylvania, with a score of 709. Highmark (706) ranks second and Aetna (670) ranks third. Blue Cross Blue Shield of Texas ranks highest in overall satisfaction with Medicare Advantage plans in Texas, with a score of 676. Cigna Health (668) ranks second and Humana (648) ranks third.

The U.S. Medicare Advantage Study was redesigned for 2023. It measures member satisfaction with Medicare Advantage plans—also known as Medicare Part C or Part D—based on eight factors (in order of importance): level of trust; able to get health services how/when I want; helping to save me time or money; product/coverage offerings meet my needs; ease of doing business; people—representatives, call center agents; resolving problems or complaints; and digital channels.

The study is based on the responses of 5,887 members of Medicare Advantage plans in five market-based U.S. regions: California, Florida, New York, Pennsylvania and Texas. It was fielded from January through June 2023.

Ayo Mseka has more than 30 years of experience reporting on the financial services industry. She formerly served as editor-in-chief of NAIFA’s Advisor Today magazine. Contact her at [email protected]. 

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Ayo Mseka has more than 30 years of experience reporting on the financial services industry. She formerly served as editor-in-chief of NAIFA’s Advisor Today magazine. Contact her at [email protected].