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9 data-driven insights on senior preferences when selecting a Medicare Advantage plan

The Medicare Advantage (MA) market is a lucrative line of business for health plans. Thousands of seniors age into Medicare eligibility daily, creating a market rife with organic growth. Medicare Advantage’s rising popularity with seniors is bolstered by competitive prices and expanded benefits, positioning MA to overtake traditional Medicare enrollment by 2025.

Medicare Advantage’s popularity with seniors has in turn increased the competition for health plans, with a record number of carriers and MA products available. Plans must fine-tune their understanding of seniors’ preferences and decision-making around plan selection to appeal to consumers and stand out in a fiercely competitive crowd.

Advisory Board conducted an online survey of 1,397 seniors over the age of 60 to understand what matters most to consumers when selecting a Medicare product and what makes the biggest difference in overall satisfaction. Our Senior Shopping Preferences Survey uncovered unique ways that seniors are exposed to Medicare Advantage, how they prioritize benefits and other aspects of product design, and how they weigh options for switching between plans. This briefing will showcase our nine data-driven insights that allow plans to get into the minds of senior consumers—and position their products to better meet these members’ needs.

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More on caring for seniors

Explore the collection of resources that our team has developed to help you understand how the industry is currently caring for older adults (ages 65+), why change is essential, and how industry stakeholders can collaborate to build a better care model for seniors.


Aging into Eligibility: Seniors’ Introduction to the Medicare Marketplace

1. Seniors do their research online but continue to prefer traditional sales channels.

Only about two-thirds of seniors research their Medicare options, whether it’s deciding between traditional Medicare and Medicare Advantage (MA) or shopping around MA plans. On one hand, this makes sense—Medicare can be extremely confusing. Researching eligibility requirements, coverage, and a variety of options is daunting and often leaves seniors feeling more confused than when they began their research. On the other hand, a wealth of information is available to seniors, and frequent Medicare Advantage shopping is necessary for healthy market competition.

Of seniors who do research their Medicare options, most are headed online. Over 60% of seniors who research use online resources: their top online resources include search engines, health insurance company portals or websites, and CMS or other government websites.

What resources did you use when researching and collecting information on Medicare plans?

What specific online resources did you use?

Despite seniors’ proclivity for online research, online sales for Medicare remain a tiny portion of all sales. Findings from our consumer survey confirm observations from health plan executives and brokers: seniors remain traditionalists in preferring to purchase Medicare plans through a live salesperson. Most Medicare Advantage sales come from independent brokers, while another significant portion comes through insurance company agents. Online sales and e-brokers generate a lot of buzz but are still a small slice of the pie for Medicare sales.

Where did you purchase your Medicare Advantage plan?

2. Brokers remain the single most important entity in the MA sales pipeline.

As we’ve established, brokers are the most common avenue for seniors purchasing Medicare Advantage plans. Their influence on a senior’s selection is significant: brokers are not going to show clients every single product available to them, and thus have tremendous weight in deciding which two to three plans seniors actually see and choose between. They also have outsized importance throughout the research and shopping process.

Brokers are the most common way seniors first hear about Medicare Advantage, followed closely by family and friends. Brokers serve a trusted role for seniors aging into Medicare eligibility and provide valuable information on not only which plan to choose, but also the nuances of Medicare programming and the ins-andouts of Medicare Advantage. What’s more, nearly one-third of seniors indicated that they first heard about their health insurance company through an insurance agent or broker—the most popular response of all options in our survey.

How did you first hear about Medicare Advantage?

How did you first hear about your current health insurance company?

Plans should not discount the value of strong broker relationships in growing their Medicare Advantage enrollment. Brokers build their own networks through happy clients—their primary business strategy depends on word-ofmouth referrals, which carry a lot of weight in the senior community. Though brokers won’t hesitate to help unsatisfied members find a new plan, they put serious stock in understanding a client’s preferences from the outset and trying to find the best fit for their needs. What’s more, broker commissions are capped by CMS and are generally similar across plans in a given market. Broker commission is not a significant factor in directing members to plans.

Plans must give brokers the tools to educate clients and help make informed decisions about which Medicare Advantage plan is right for them. Brokers often lack an understanding of the clinical quality and value of a plan, so plans should provide customized training that clarifies why their unique product design is right for seniors. Finally, plans should go the extra mile to ensure brokers have easy, timely access to helpful broker support teams. Friendly relationships might not guarantee a sale, but negative relationships with brokers could cause them to sway clients in a different direction.

3. Seniors have interest in sticking with their pre-Medicare carrier—but aren’t always loyal when it comes time to enroll.

Shopping for and switching between health insurance plans can be confusing and time-consuming—which may be why nearly half of seniors say they would stay with their same health insurance carrier once they age into Medicare.

How likely are you to stay with the same health insurance provider once you become eligible or decide to sign up for Medicare?

But when push comes to shove, only one-third of seniors said they stayed with the same plan when enrolling in a Medicare product. There are a lot of reasons seniors who planned to stay may switch, such as having a negative experience with their old plan, finding a new carrier that better fits their needs, or their old insurer not offering an MA plan. Regardless, it’s clear that plans have a missed opportunity for converting members from other lines of business into their Medicare Advantage products.

Did you have the same insurance company prior to enrolling in Medicare Advantage or MedSup?

Converting members from other lines of business (LOBs) is easier said than done, often due to silos between products. Lack of data-sharing or automatic triggers to identify members who will soon be eligible for Medicare Advantage commonly contribute to these silos between lines of business. Leaders may also lack communication or working relationships with their counterparts in different lines of business. Identifying and correcting the reasons for silos between LOBs at your organization can help retain members—and streamline their experience aging into a new type of coverage.

Sales: Action Items for Health Plans

1. Don’t underestimate the impact of brokers on directing new Medicare Advantage members. Understand brokers’ priorities when shopping for MA plans with seniors and make it easy for brokers to want to sell your product.

2. Strengthen relationships and data-sharing with other lines of business to identify opportunities to convert members to Medicare Advantage. There should be automatic triggers when a member in another line of business at your plan is about to age into Medicare.

3. Take advantage of known ranking factors for strategic placement on and present plans by ZIP code in order of CMS’ determination of the most cost-effective plan. But appearing first on their list is not always desirable. Appearing first may attract larger numbers of members than your plan is prepared to handle and will enroll most members on your most cost-effective plan—meaning less opportunity for profit. Attempt to price products to appear second to fourth in search results.


Drowning Out the Noise: What it Takes to be the Plan of Choice

4. Most seniors consider only one or two plans despite having access to a significant number of plans to choose from.

The average senior in 2022 has access to 39 different Medicare Advantage plans, but most people aren’t actively considering even a fraction of those offerings. It’s nearly impossible for a consumer to accurately compare so many plans, especially when they look similar on paper. In fact, over 80% of seniors said they chose between only one to two plans when shopping for a Medicare Advantage product.

How many Medicare plans were you choosing between?

What does this mean in practice? Some seniors may approach Medicare enrollment with a single plan in mind, whether they’re familiar with the brand from their previous insurance or were recommended by a spouse or friend. Separately, brokers and agents guide a significant number of seniors toward a subset of plans using criteria that effectively disqualifies many plans from consideration.

Initial features that seniors or brokers look for when filtering through available plans include their current PCP’s inclusion in the network, plan type (PPO or HMO), premium costs, and drug coverage. These criteria are often enough to leave just a few plans in consideration for seniors to choose between. Plans in that narrowed pool can stand out based on their brand name, offering of supplemental benefits, and overall cost sharing.

5. Practical criteria, like competitive pricing and robust physician networks, are table stakes—but not enough to be selected.

The large number of Medicare Advantage plans available in any given market means it’s extremely tough to stand out from the competition. Many MA products look similar, which means that offering core supplemental benefits (i.e., dental, hearing, and vision) or having a 4-Star rating doesn’t make your plan the obvious choice. In fact, it’s tough to say what—if anything—can make a plan the “obvious choice.”

Most seniors feel that the most important factors when choosing a Medicare plan are the ability to stay with their current doctor and maintain out-of-pocket costs. Given the wealth of options to choose from, these preferences have become table stakes criteria—just enough to get your plan in the door, but not enough to guarantee enrollment. These preferences are echoed when seniors reflect on what makes their Medicare plan the best fit for their needs.

What factors are most important when choosing a Medicare Plan?

What makes the Medicare plan you chose the best fit for your needs?

While only a small fraction of seniors say that supplemental benefits are the most important factor when picking a plan, these benefits (along with brand recognition, customer service, and recommendations from family and friends) play a far greater role when seniors decide between plans that are nearly identical on cost and network coverage. Plans need to ensure they are meeting the baseline expectations of consumers—through competitive pricing, access to a broad range of providers, and inclusion of core supplemental benefits—while experimenting with innovative supplemental benefits to help stand out from the pack.

6. Every supplemental benefit appeals to someone, but you can’t offer everything at once.

Almost all supplemental benefits are valuable to a given subset of seniors—showing great diversity in benefit appeal across the board. In fact, when surveyed, at least one-third of seniors ranked each supplemental benefit in their top five choices (outside of acupuncture and social support services, which were excluded from the graphic below). Seniors may have interest in many supplemental benefits, but it’s not feasible to offer all available benefits in a single product. Rather, health plans should offer multiple products in each market that complement each other. This strategy has been adopted by the largest national MA carriers, with some carriers offering more than five MA products in a given county.

Offering diverse benefit packages for MA products in a single market allows plans to use supplemental benefits to attract different target members. Combinations of benefit offerings should intentionally cater to specific cohorts or care needs. For example, a product geared toward a younger, healthier senior population may include robust fitness benefits, while transportation benefits and support for caregivers may be more attractive to older or sicker members.

Which of the following benefits would you value most when choosing a Medicare plan?

While most benefits have value to at least a subset of seniors, in-home support services and OTC drug cards rank as the most broadly desirable supplemental benefits surveyed. These benefits both offer seniors convenience and flexibility in how they choose to receive care and spend their health care dollars. Over-the-counter drug cards, in particular, have seen a significant increase in popularity in plans—which makes sense given how “sticky” they are as a benefit. A whopping 57% of seniors said this benefit alone could somewhat or strongly influence their likelihood of choosing that MA plan. More and more plans have recognized the value of this benefit (with 81% of individual MA plans offering OTC cards in 2022). Plans must realize that offering this benefit is necessary to stay competitive going forward.

To what extent would an OTC spending card benefit impact your likelihood of choosing a certain Medicare plan over a plan that did not offer this benefit?

7. Seniors aren’t selecting based on quality—because high Star ratings have become an expectation.

Star ratings may have once been a key differentiator between MA plans for seniors, but that’s no longer the case. High Star ratings have become table stakes for brokers and seniors choosing a health plan due to the preponderance of highly rated MA plans. CMS reported that in 2022 over 90% of MA enrollees are on plans with 4+ Star ratings. Additionally, nearly all seniors now have access to one or more 4+ Star rated plans in their county. Given their ubiquity, it’s no surprise that seniors ranked Star ratings as one of the least influential factors when selecting an MA plan. Only 2% of seniors ranked this as the most influential factor when selecting an MA plan and just 4% had it in their top two.

Star ratings aren’t necessarily influential in seniors’ plan selection process, but they’re still very important to plans. Plans with high Star ratings receive higher quality bonuses and rebates that can then be reinvested to improve their product offerings. For example, an MA plan with 4 Stars receives a 5% bonus payment and can use that money to offer more robust supplemental benefits in the next plan year.

Standing out to Seniors: Action Items for Health Plans

1. Offer multiple products in each market that complement each other and target different subsets of the population. In addition to offering choice in price points, plans can and should offer supplemental benefits to attract different target members.

2. Ensure your plan is making proper investments in staff and data to stay on top of the complex documentation requirements from CMS and keep pace with ongoing work. Earning and maintaining high Star ratings is a time- and resource-intensive process.

3. Stay abreast of regulatory changes that may impact Star rating calculations. CMS recently increased the weighted importance of patient experience measures (e.g., CAHPS scores) on Star ratings, with plans to further increase the weight in 2023.


Understanding the Itch to Switch: What it Takes to Keep Members Loyal

8. Most MA enrollees claim they’ll shop around, but very few actually switch.

Medicare Advantage was designed to operate in an environment where seniors shop for the best plan for their needs every year. According to our survey, 87% of seniors claim they will shop around for MA plans—but only 15% of Medicare beneficiaries said they would consider switching MA plans and only 11% actually switch. The number of seniors who claim they’ll shop around may be deceptively high. Many would-be shoppers say they want to make sure they have the best deal or want to have a sense of all their options—but in reality, very few take the time or have the adequate expertise to review their options each year.

Ideally, seniors would shop the MA marketplace each year to understand their options (including newly available plans) and make choices in line with changing care needs. Medicare beneficiaries’ lack of shopping means that many seniors may no longer be on the plan that best suits their current needs.

Seniors are hesitant to switch plans for many reasons, but arguably the most important factor is that they are generally very satisfied with their current MA plan. Over 80% of MA enrollees said they were satisfied with the cost of their plan and 86% said they were satisfied with the benefits they receive. However, it’s possible that seniors are only satisfied with their current MA plan because they’re unaware of other offerings.

Supplemental benefits play a significant role for seniors considering switching plans. Of seniors considering switching plans, 42% said they’d consider switching to get either a broad range of supplemental benefits or a specific benefit versus just 18% saying it was related to their network of providers.

What is the primary reason you would consider making Medicare plan changes?

9. Seniors lack complete understanding of their current benefits and coverage, which can lead to dissatisfaction with their MA plan.

Health plans and brokers tell us over and over just how confused seniors are by Medicare Advantage, which isn’t a huge surprise given the complexities of the program. Many health plans and brokers emphasize that seniors often don’t know which supplemental benefits are covered in their plan, let alone the details of that coverage. This can lead some members to switch plans in pursuit of a benefit that’s already covered in their current plan. Survey results reinforce the notion that seniors may be confused or lack awareness of their current offerings—seniors most desire more information related to their benefits and covered services.

What type of information would you most want from your insurance company about your health plan?

Most health plans provide members with this information during onboarding and make additional information available through member portals—however, that’s not enough. While seniors are becoming more technologically enabled, health plans’ member portals are still scarcely used. Nearly 30% of seniors say they’ve never used it before and 41% say they’ve used it only once in the past year.

Have you logged into your health insurance company’s online portal in the past 12 months?

With low utilization of health plan member portals, it’s imperative that health plans pursue alternative communication channels to help educate their members. Email and physical mail remain seniors’ most preferred methods of communication by far. Half of the respondents to our survey said that email was their most preferred method of communication with their health plan, followed by 42% preferring physical mail. To minimize duplicative communication costs and reduce overloading a member with too many messages, health plans should figure out a member’s preferred method of communication and frequency of outreach at the beginning of their member journey. We found that most seniors would like to hear from their plan on a monthly basis (70%), followed by yearly (21%), and then weekly (6%).

How often would you like to receive information from your insurance company about your health plan?

Driving Member Loyalty: Action Items for Health Plans

Seniors most want information from their insurance company on benefits and covered services, including prescription drug benefits, indicating that there’s a member education gap that needs to be filled.

1. Determine members’ communication preferences during onboarding. Take into account members’ preferred communication channels and frequency of outreach, then customize outreach accordingly.

2. Bridge the member education gap by providing regular updates about the services and benefits available. Make sure members are informed and confident using their current coverage rather than looking down the road for something they may already have.

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