Of the nation's 41.7 million Medicare enrollees in 2004, 4.7 million (11%) were enrolled in managed care plans. Participation in Medicare managed care increased steadily in the 1990s, reaching a peak of 6.3 million beneficiaries (16%) in 2000. Enrollment declined between 2000 and 2003 due to plan withdrawals from some areas, reduced benefits, and higher premiums. The Medicare Prescription Drug, Improvement, and Modernization Act of 2003, enacted December 8, 2003, increased Medicare payments to private managed care plans (now called Medicare Advantage). Medicare Advantage plans used increased payments to raise payments to providers, lower enrollee premiums, enhance existing benefits, and increase stabilization funds. Enrollment in Medicare Advantage plans rose slightly from 2003 to 2004.

	1990	1991	1992	1993	1994	1995	1996	1997	1998	1999	2000	2001	2002	2003	2004
Percent of Beneficiaries Enrolled in Traditional Medicare Program	96%	96%	96%	95%	94%	92%	89%	86%	84%	84%	84%	86%	88%	89%	89%
Percent of Beneficiaries Enrolled in Medicare Managed Care	4%	4%	4%	5%	6%	8%	11%	14%	16%	16%	16%	14%	12%	11%	11%

Source: Kaiser Family Foundation calculations using data from the Centers for Medicare and Medicaid Services, Medicare Managed Care Contract Plans Monthly Summary Reports for December 1 of each year, at http://www.cms.hhs.gov/healthplans/statistics/mmcc/ (Medicare managed care enrollment), and total Medicare enrollment data from the Centers for Medicare and Medicaid Services, Office of the Actuary, personal communication.