Deft Research’s annual national market research report examined the shopping and switching habits of more than 3,300 Medicare beneficiaries during the most recent Annual Election Period (AEP). The insights on what triggers led seniors to shop for other plans and ultimately choose a new carrier can help Medicare Advantage (MA) plans better prepare for the 2023 AEP.
Increased competition, a boom in the number of 4.5-and 5-Star plans, and fewer plan switchers made it difficult to grow MA market share in 2022, according to an executive brief of Deft Research’s 2022 Medicare Shopping and Switching Study. The report’s year-over-year analysis identifies trends and drills down on the behaviors of shoppers, non-shoppers, and plan switchers. This year’s study focuses on current trends in marketing and sales, the impact of Star ratings, a breakdown and analysis of enrollment channels, and experiences, attitudes, and emotions in shopping and switching.
George Dippel, executive vice president, client Services, Deft Research, will provide a deep dive into the study findings at RISE’s upcoming Medicare Marketing & Sales Summit, Feb. 16-18, at Caesars Palace, Las Vegas. But the executive brief offers a few of the highlights.
Dippel said in the executive brief that the average U.S. senior had 16 MA plan options in 2015. That number has surged to 29 this year. But the extra competition made it especially difficult to grow market share because MA switching meaningfully decreased during that same time from 23 percent to just 12 percent today. That 12 percent has sat unchanged for three cycles now, the report noted.
One differentiator that MA plans strive for is high-quality ratings. But more plans have high Star ratings this year thanks to the Centers for Medicare & Medicaid Services (CMS) providing flexibility due to COVID-19. As a result, there was a 110 percent increase in 4.5 Star plans this year and a 205 percent increase for 5-Star Plans, according to the executive briefing.
But while higher ratings result in greater member retention, Deft found that switchers barely pay attention to them. Only two percent of switchers had Star ranked in their top three factors that contributed to their switch, the briefing said. Therefore, Deft said the best way to grow market share is to focus on the most important element of an MA plan: product design.