How Health Insurers and Brokers Are Marketing Medicare
Most of the 65 million beneficiaries who receive health insurance coverage through the federal Medicare program are enrolled in some form of private plan. In 2023, 31 million Medicare beneficiaries are enrolled in Medicare Advantage (Medicare Part C) plans administered by private health insurers. The other 34 million beneficiaries are in traditional Medicare, including 22 million beneficiaries who are enrolled in a Medicare Part D prescription drug plan offered by private sponsors, and more than 14 million who have Medicare supplemental insurance (Medigap) offered by private insurers (traditional Medicare beneficiaries may be enrolled in a Part D plan, a Medigap plan, or both).
Private plan offerings have grown in recent years, most notably in the Medicare Advantage market. More Medicare Advantage plans are available in 2023 than in any prior year. Medicare Advantage enrollment has doubled since 2010, due in part to extensive marketing efforts and the draw of extra benefits and attractive cost features. Each year, beginning on October 1st, insurers, as well as brokers and other third-party entities, are permitted to begin marketing Medicare Advantage for the annual open enrollment period for coverage in the following year. The open enrollment period for Medicare Advantage and Medicare Part D plans runs from October 15th through December 7th. Television ads are one of many marketing activities used by insurers, brokers and other third-party entities to boost enrollment.
Recently, the Centers for Medicare and Medicaid (CMS) has reported a steep rise in beneficiary complaints related to the marketing of Medicare Advantage and Part D plans. Many of these complaints have centered on the activities of brokers and other third-party entities, referencing misleading claims and aggressive sales tactics. Concerns raised by the National Association of Insurance Commissioners and in a report released by the majority staff of the U.S. Senate Committee on Finance have also called attention to this issue. In response, CMS published updated regulations, effective June 2022, mandating stricter oversight of these third parties by the insurers they represent. Additional CMS requirements intended to curtail misleading marketing activities came into effect in June 2023, and will apply to the open enrollment period for 2024 coverage and beyond.
To capture the state of television marketing activities and consider the implications for people with Medicare, KFF analyzed ad data compiled by the Wesleyan Media Project, that were obtained from Vivvix (formerly Kantar) CMAG, a data analytics and consulting firm, and were coded by the Wesleyan Media Project in collaboration with KFF. The data set included all English-language TV ads that aired across national and local markets on broadcast television or national cable, from October 1st, 2022, through December 7th, 2022, the period that includes the Medicare open enrollment period for coverage in 2023. (see Methods).
- TV airways were flooded with ads for Medicare plans. Nearly 650,000 airings of Medicare ads appeared during the nine weeks of advertising, more than 9,500 airings per day. Most of these ads were aired in local media markets. While most TV ads were sponsored by health insurers, about one in every five TV ads were sponsored by brokers and other third-party entities, such as marketing firms.
- TV ads for Medicare Advantage comprised more than 85% of all airings for the open enrollment period for 2023. The remaining ads focused on other types of plans, such as Medigap and stand-alone Part D prescription drug plans, or promoted the open enrollment period more generally. Medicare Advantage ads were disproportionately sponsored by health insurers who offer plans that comprise a relatively small share of Medicare Advantage enrollees.
- TV ads for Medicare Advantage often showed images of a government-issued Medicare card or urged viewers to call a “Medicare” hotline other than the official 1-800-Medicare hotline. More than a quarter of all airings (27%) included a government-issued Medicare card or image that resembled it, including 28% of insurer-sponsored airings and 21% of airings sponsored by brokers and other third-party entities, a trend that CMS has flagged as potentially misleading to beneficiaries. Roughly 16% of airings featured a privately-run phone line described as a “Medicare” hotline, most of which were sponsored by brokers and other third-party entities.
- Some ads suggested that people with Medicare miss out on benefits to which they are entitled if they are not enrolled in a Medicare Advantage plan. These TV ads were more common among ads sponsored by brokers and other third-party entities than those sponsored by health insurers, and used language that implied viewers were “missing out” on benefits they were “entitled to,” or receiving incomplete coverage under Medicare Parts A and B if they were not enrolled in a Medicare Advantage (Part C) plan
- The vast majority of Medicare Advantage ad airings touted low costs and extra benefits, while few mentioned quality ratings. Nearly all Medicare Advantage ad airings emphasized extra benefits, such as dental, vision, and hearing (92%) or the potential for lower out-of-pocket spending (85%). Airings sponsored by brokers and other third-party entities often (67%) promoted the potential for enrollees to get money back in their Social Security check (or lower their Medicare Part B premium). Few airings (4%) mentioned quality star ratings.
- Medicare Advantage ad airings often featured active seniors engaged in physical activities, but rarely showed people who appeared to have a serious health problem or visible disability. One in four Medicare Advantage ad airings (26%) showed seniors taking part in activities such as hiking or yoga, but few included people with visible disabilities (4%) or the appearance of serious illness (1%) for whom health insurance coverage and choice of providers may be a high priority.
- TV ads sponsored by brokers and other third-party entities used celebrity endorsements more often than health insurers to promote Medicare Advantage. Celebrities, such as actors, athletes, and politicians, appeared in more than half of Medicare Advantage ad airings sponsored by brokers and other third parties (55%), but rarely appeared in airings sponsored by insurers (3%). Familiar figures included Joe Namath, Lionel Richie, William Shatner, and JJ Walker. Joe Namath was featured more than any other celebrity, appearing in nearly 56,000 airings.
Medicare beneficiaries have a wealth of choices for their health insurance coverage. While beneficiaries may appreciate the ability to select from multiple options, the variable costs, benefits, provider networks, and other characteristics of Medicare Advantage plans make the decision complex, especially in light of the barrage of advertising. Additionally, information about coverage under traditional Medicare is rarely included in television ads, leaving beneficiaries with an incomplete view of their coverage options and the tradeoffs among them. While CMS has issued new rules to address concerns about aggressive and misleading marketing tactics, ongoing monitoring and resources independent of commercial interests could help to improve beneficiary decision-making.