Enrollment in Medicare Supplement coverage is growing for traditional Medicare beneficiaries, a new report found.
The share of traditional Medicare enrollees who bought Medicare Supplement coverage rose to 41% in 2021, compared to 35% in 2017, the America’s Health Insurance Plans’ (AHIP) report discovered. About 54% of traditional Medicare enrollees who didn’t have additional coverage — such as Medicaid, employer-sponsored insurance, Medicare Advantage or Veterans Affairs coverage — selected Medicare Supplement coverage in 2020.
The report, published last week, examined 2021 Medicare Supplement data from the National Association of Insurance Commissioners, 2021 California Department of Managed Health Care data and the 2020 Medicare Current Beneficiary Survey. Medicare Supplement, also referred to as Medigap, provides additional coverage for Medicare patients that they can purchase. It helps protect enrollees from high out-of-pocket costs that aren’t covered by traditional Medicare.
“Medicare Supplement coverage protects the health and financial well-being of over 14 million seniors,” said Jeanette Thornton, AHIP executive vice president of policy and strategy, in a news release. “It’s an important resource that protects Americans from high out-of-pocket costs not covered by original Medicare, helps them budget for medical expenses, and simplifies their bill paying.”
Medicare Supplement enrollees are also three times less likely to have issues paying medical bills than those who only have traditional Medicare, according to the report. Just 3% of those with Medicare Supplement coverage experienced challenges paying medical bills in the previous 12 months, versus 8% of traditional Medicare enrollees without Medicare Supplement coverage.
Additional findings from the report include:
- Most Medicare Supplement enrollees in 2020 were women, accounting for 57% of all Medicare Supplement policyholders.
- About 42% of Medicare enrollees with Medicare Supplement coverage were 75 years old or older in 2020, versus 36% of all Medicare enrollees.
- Many enrollees with Medicare Supplement coverage have lower incomes: 24% of Medicare supplement policyholders had annual household incomes of below $30,000 in 2020. About 11% had annual household incomes below $20,000.
- In 2020, about 25% of Medicare Supplement enrollees lived in non-metropolitan areas, meaning an area with less than 50,000 people.
- Eleven states had at least 50% of its traditional Medicare enrollees enrolled in Medicare Supplement coverage. Iowa had the highest percentage of those with Medicare Supplement coverage, at 65.2%. Hawaii had the lowest, at 9%.
Photo: Vadzim Kushniarou, Getty Images
