Industry

Survey: Medicare Advantage enrollees had 36% lower out-of-pocket costs than traditional Medicare in

Q: What the sponsor said

Mary Beth Donahue, CEO of the **Better Medicare Alliance**, described the findings in the group's release as evidence that Medicare Advantage is providing meaningful savings while maintaining high-quality care. She noted that more than 35 million beneficiaries rely on Medicare Advantage for affordability, benefits and coordinated care, and urged policymakers to protect and strengthen the program.

27 Jul 20260 viewsOriginal Source

News Highlights

An analysis by ATI Advisory for the Better Medicare Alliance found Medicare Advantage (MA) enrollees paid $2,824 less out-of-pocket on average in 2023 than people in traditional fee-for-service Medicare.
The $2,824 difference represents a 36% lower out-of-pocket spend for MA members in 2023; savings were 16% larger in 2023 than in 2022, per the report.
Satisfaction scores for quality of care and access were reported as similar between MA and traditional Medicare beneficiaries despite the lower costs for MA enrollees.
Twelve percent of MA beneficiaries reported a significant cost burden (spending more than 20% of income on healthcare), compared with 24% of traditional Medicare enrollees.
The lower spending trend among MA members held across income levels, racial and ethnic groups, geographic regions and number of chronic conditions.
The report noted that 54% of MA beneficiaries have incomes below 200% of the federal poverty level, versus 30% of fee-for-service Medicare enrollees; more than three-quarters of MA members have three or more chronic needs.
MA members were 15% more likely than traditional Medicare enrollees to have had an annual wellness visit, according to the analysis.
The study used data from the Medicare Current Beneficiary Survey and Cost Supplement files covering 2021 through 2023.
The Better Medicare Alliance frame: the findings indicate MA delivers savings while maintaining high-quality care, and the group called for policymakers to protect and strengthen the program.

New analysis finds Medicare Advantage enrollees pay substantially less out-of-pocket

A study performed by ATI Advisory for the Better Medicare Alliance reports that Medicare Advantage (MA) enrollees paid an average of $2,824 less out-of-pocket in 2023 than beneficiaries in traditional fee-for-service Medicare. That gap equates to a 36% lower out-of-pocket spend for MA members in 2023, and the report states the savings were 16% larger in 2023 compared with 2022.

The analysis drew on the Medicare Current Beneficiary Survey and Cost Supplement files covering 2021 through 2023. Researchers examined out-of-pocket spending, reported financial burden and measures of satisfaction with access and quality of care.

Financial burden and who benefits

The report highlights differences in the share of beneficiaries who face a significant cost burden—defined in the analysis as spending more than 20% of income on healthcare. Among MA enrollees, 12% reported such a burden, compared with 24% of people enrolled in traditional Medicare.

Researchers found the trend toward lower spending for MA members persisted across multiple subgroups, including income levels, racial and ethnic groups, geographic regions and number of chronic conditions. The report emphasizes the pattern is notable because a large portion of the MA population tends to be lower-income or have multiple chronic conditions.

According to the analysis, 54% of Medicare Advantage beneficiaries have incomes below 200% of the federal poverty level, while 30% of fee-for-service Medicare enrollees fall below that same threshold. The report also notes that more than three-quarters of MA members have three or more chronic needs.

Use of preventive care and satisfaction

Beyond spending differences, the analysis found members of Medicare Advantage plans were more likely to receive certain preventive services. Specifically, MA members were 15% more likely than those in traditional Medicare to have had an annual wellness visit.

On measures of perceived care, the researchers reported similar scores for satisfaction with quality of care and access between MA and traditional Medicare enrollees. In other words, the lower out-of-pocket spending observed for MA beneficiaries did not coincide with lower reported satisfaction in the study’s findings.

What the sponsor said

Mary Beth Donahue, CEO of the Better Medicare Alliance, described the findings in the group's release as evidence that Medicare Advantage is providing meaningful savings while maintaining high-quality care. She noted that more than 35 million beneficiaries rely on Medicare Advantage for affordability, benefits and coordinated care, and urged policymakers to protect and strengthen the program.

Study methods and timeframe

The analysis by ATI Advisory used data from the Medicare Current Beneficiary Survey and associated Cost Supplement files spanning 2021 to 2023. The report compared average out-of-pocket spending, the prevalence of significant cost burden, preventive care use and satisfaction metrics between MA and fee-for-service Medicare populations. Detailed methodology beyond the data sources and years analyzed was not reported in the summary released with the findings.

Context and implications reported by the sponsor

The report frames the lower out-of-pocket costs for MA enrollees as especially significant given the demographic and clinical profile of many MA members—over half have incomes below 200% of the federal poverty level and a substantial majority have multiple chronic needs. Those characteristics, the analysis suggests, make cost reductions particularly important for MA enrollees.

The Better Medicare Alliance presentation of the results ties the financial findings to policy recommendations, urging protection and strengthening of Medicare Advantage to preserve its affordability and care coordination benefits for beneficiaries. The source material does not provide specifics about which policy actions the alliance recommends.

What the report did not report

The summary of the analysis did not include detailed breakdowns of out-of-pocket spending by specific service categories, nor did it report geographic state-level differences, plan types within Medicare Advantage, or a full methodological appendix in the release. It also did not provide granular satisfaction scores or statistical testing details in the excerpted findings.

Bottom line

Using 2021–2023 Medicare Current Beneficiary Survey data, ATI Advisory’s analysis for the Better Medicare Alliance found that Medicare Advantage enrollees paid substantially less out-of-pocket in 2023 than beneficiaries in traditional Medicare, while reporting similar satisfaction with access and quality of care. The sponsor framed the results as evidence that MA can deliver affordability and coordinated benefits for beneficiaries, and called on policymakers to maintain and bolster the program.