Report: More traditional Medicare enrollees are buying supplemental Medicare coverage [Boss Insurance]

Report: More Traditional Medicare Enrollees Are Buying Supplemental Medicare Coverage

Medicare supplement coverage enrollment increases for traditional Medicare beneficiaries, a new report find.

The share of traditional Medicare enrollees who purchased Medicare Supplement coverage rose to 41% in 2021 from 35% in 2017, the US Health Insurance Plans (AHIP) report found. About 54% of traditional Medicare enrollees who did not have supplemental coverage — such as Medicaid, employer-sponsored insurance, Medicare Advantage, or veterans’ coverage — chose Medicare Supplement coverage in 2020.

The report, released last week, looked at data from the National Association of Insurance Commissioners’ 2021 Medicare Supplement, 2021 data from the California Department of Managed Health Care and the 2020 Survey of Current Medicare Beneficiaries. The Medicare supplement, also called Medigap, provides additional coverage for Medicare patients that they can purchase. It helps protect enrollees from high out-of-pocket costs not covered by traditional health insurance.

“Medicare supplement coverage protects the health and financial well-being of more than 14 million seniors,” said Jeanette Thornton, AHIP’s executive vice president of policy and strategy, in a statement. Press release. “This is an important resource that protects Americans from high out-of-pocket expenses not covered by original health insurance, helps them budget their medical expenses, and simplifies paying their bills.”

According to the report, people enrolled in supplement Medicare are also three times less likely to have problems paying their medical bills than those with only traditional health insurance. Only 3% of people with Supplemental Medicare coverage had difficulty paying their medical bills in the previous 12 months, compared to 8% of traditional Medicare enrollees without Supplemental Medicare coverage.

Other findings from the report include:

  • Most Supplement Medicare enrollees in 2020 were women, accounting for 57% of all Medicare Supplement enrollees.
  • About 42% of Medicare enrollees covered by Supplemental Medicare were 75 or older in 2020, compared to 36% of all Medicare enrollees.
  • Many enrollees with Supplemental Medicare coverage have lower incomes: 24% of Supplemental Medicare enrollees had an annual household income of less than $30,000 in 2020. About 11% had an annual household income of less than $20,000 .
  • In 2020, approximately 25% of supplement Medicare enrollees lived in non-metropolitan areas, that is, an area with fewer than 50,000 people.
  • Eleven states had at least 50% of their traditional Medicare enrollees enrolled in Supplemental Medicare coverage. Iowa had the highest percentage of people covered by Supplemental Medicare, at 65.2%. Hawaii had the lowest, at 9%.

Photo: Vadzim Kushniarou, Getty Images