Our seniors are not getting enough information about choosing the Medicare plan that works best for them.
From a survey conducted by Sage Growth Partners, we have learned that there is a lot of confusion and frustration with the process of Medicare enrollment. About 64 million U.S residents are enrolled in Medicare, and the Census guesses that this number will rise to 73 million in the next ten years. For the survey, they talked to 1,142 individuals aged 64, and older Here are some of the statistics learned from this study.
“Only 20% of Medicare-eligible individuals have a good understanding of Original Medicare; only 31% have a good understanding of Medicare Advantage; 63% are overwhelmed by Medicare advertising, and only 31% ‘strongly agree’ that they can make effective selection decisions.” “More than half (58%) stay in their current Medicare plan each year rather than reviewing their options and enrolling in the best plan for their evolving needs. One-third (33%) have a financial advisor, but only 2% use that advisor to help with plan selection. While three-quarters of respondents (75%) feel they could choose the right Medicare plan, four out of five gave incorrect answers when asked to identify components of an Original Medicare plan. Similarly, nearly two out of three incorrectly identified Medicare Advantage plan components.”
These statistics are worrisome because if these enrollees are not selecting the best plan for their situation, they could be paying way too much for something that does not meet their needs. Shockingly, the youngest of the respondents are the ones who scored the lowest when it came to questions about Original Medicare and Medicare Advantage. Close to 2/3 of the respondents indicated that they were overwhelmed by advertising, and 1/3 said they strongly agreed that they would be able to keep up with their plan updates. Just 1/3 of respondents said they thought they would be able to find information regarding their plans to make decisions. Unfortunately, when given a Net Promotor Score (NPS) that measured customers’ loyalty, most respondents said that they would rate their experience as poor to terrible, with the youngest of respondents giving the lowest score of them all. Another statistic that shows how difficult this process is says that people describing their health as “terrible” gave the lowest scores.
Along with the low scores stated above, more than half of Medicare-eligible people stay with their current plans rather than reviewing as they age and health potentially declines. The reason for this is frustration with the process. According to the study, around 63% of adults aged 45-65 have been diagnosed with a chronic condition, which moves up to 87% when you are over 65. They also say that health care spending goes up as you age. These statistics indicate how important it is for people with Medicare plans to annually review them and decide what is best for their situation. A way to help get through this confusing process is to hire a financial advisor. Only about 33% of Medicare-eligible individuals have only about 2% use them for Medicare planning. Many Medicare enrollees are unaware of the different resources they can use to help navigate these waters, which include helplines and other independent insurance agents. Of the respondents that used a helpline, not many trusted the advice that was given. However, of the respondents who use a financial advisor, around 92% trusted their advice. The unfortunate part is that only about 2% use a financial advisor.
All of these statistics show that our Medicare-eligible population needs help navigating the process of enrollment. It’s likely that they would trust the advice given to them by a financial advisor, so it is important to change up advertising and offer more resources to help with the process. It is especially important to review their Medicare plans often to ensure they receive the best benefits for their situation. From the study, it seems like having a trusted individual to help understand everything is what gets the best results.
The original article about the report is here: https://finance.yahoo.com/news/report-reveals-significant-gaps-medicare-124900315.html?guccounter=1 and the report itself is here: https://sage-growth.com/index.php/2022/07/medicare-market-report/