Medicare Advantage National Penetration Rates

Some 28 million U.S. residents are signed up for Medicare Advantage plans across the nation. This means that about 44% of all 64 million people eligible for Medicare are enrolled in Medicare Advantage plans – a number called the “Penetration Rate.” As of December 2021, Minnesota’s Aitkin County boasted the top penetration rate in the 50 U.S. states, with 81% of all Medicare-eligible citizens are enrolled in Medicare Advantage plans.

Medicare Advantage Penetration Rates by County

What Is Medicare Advantage?

Medicare Advantage offers the same access to doctors and hospitals as Original Medicare with other benefits. These options include prescription drugs, vision and dental coverage. Private companies run Medicare Advantage plans with deductibles, copayments, and coinsurance. Members generally get their benefits through an HMO or PPO. Beneficiaries find lower premiums and a cap on out-of-pocket costs. But they get fewer choices of doctors and are limited to a geographic area for their plans.

Medicare Advantage Posts Steady Growth

Enrollment in Medicare Advantage nationwide rose from 10 million in 2008 to 28 million in 2021, making up an increasing share of all Medicare beneficiaries. Despite the rapid growth, the total number of Medicare beneficiaries has risen even faster – from roughly 45 million to some 64 million people – meaning Medicare Advantage has plenty of room to grow.

Medicare Advantage Enrollment over Time

Medicare Advantage Fast Facts

28 million enrolled in Medicare Advantage

44% penetration rate

9% annual growth from 2019 to 2020

Top 10 States

Among the 50 U.S. states (excluding Puerto Rico which at 82% has by far the highest figure of any U.S. territory), the state with the greatest Medicare Advantage penetration is Michigan, at 50%.

Top 10 Counties

Counties with the top Medicare Advantage penetration rates in the 50 U.S. states range from Minnesota’s Aitkin at number one to counties in states as different as New York and Tennessee. Counties’ widely differing penetration rates can be accounted for by private insurers’ decisions whether or not to sell plans in a given county. For example, if a specific county in Mississippi has extremely high healthcare usage rates, an insurance company might not want to offer Medicare Advantage to those residents because of potential claim costs.

A Bright Future

The adoption of privatized Medicare took off after the 2003 enactment of the Medicare Prescription Drug, Improvement, and Modernization Act. The annual rate of growth of Medicare Advantage enrollment reached nine percent between 2019 and 2020. The Congressional Budget Office (CBO) projects that Medicare Advantage enrollees will comprise as much as 51% of all Medicare beneficiaries by 2030.