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The article that appears below is “MA penetration expected to top 64% by 2034, analysis finds,” which originally was published by McKnight’s Home Care. We apologize for any confusion or inconvenience.

MA penetration expected to top 64% by 2034, analysis finds

Growing Medicare Advantage enrollment shows no signs of slowing down, according to a new analysis by KFF. Meanwhile, home health providers continue to struggle under inadequate payment rates offered by MA payers.

As of 2024, MA covers 54% of the Medicare-eligible population, or roughly 32.8 million seniors. Likewise, MA accounts for 54% of total federal Medicare spending. Medicare spent $462 billion on MA in 2024. These figures will only continue to rise in the next decade; the Congressional Budget Office has projected that MA penetration will top 64% by 2034, according to KFF.

Growth in the sector has been driven primarily by the largest insurance companies. UnitedHealth Group and Humana, combined, cover more than 15 million older adults, which is almost half of all MA enrollees. The market shares of many other insurers — namely, Kaiser Permanente, Centene, Cigna and Blue Cross Blue Shield — have been in decline.

Meanwhile, consumers’ freedom of choice for their healthcare coverage also has declined. In 2024, the average Medicare beneficiary can choose among MA plans offered by eight insurance companies. This is one fewer than in 2023 and 2024. 

KFF also found that enrollment in special needs plans has skyrocketed in recent years. More than 6.6 million beneficiaries were enrolled in SNPs in 2024, which is twice that of SNP enrollment in 2019. A recent, unrelated report by the Medicare Payment Advisory Commission found that MA plans are increasingly serving patients with chronic kidney disease, who often require home care services, including home-based dialysis.

Many home care providers have reported challenges as a result of rising MA penetration. MA plans generally pay far less for home health services compared with traditional Medicare. In March, LeadingAge sent a letter to the Centers for Medicare & Medicaid Services urging stricter oversight of the MA program. LeadingAge noted that MA plans generally reimburse between 60% and 80% of what traditional Medicare would pay for home health.

Additionally, MA insurers’ cost-management practices have placed additional strains on home health providers. Copays and prior authorization have deterred some beneficiaries from seeking care, prompting outcry by home care stakeholders.

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