SOURCE: Mark Farrah Associates

Mark Farrah Associates

February 11, 2009 15:24 ET

Medicare Advantage Market Matures

KENNEBUNK, ME--(Marketwire - February 11, 2009) - After three years of intense competition, Medicare Advantage organizations wisely scaled back growth expectations for the 2008-2009 open enrollment season. Membership reports confirm a slowing growth rate, about 2% from October 2008 through January 1, 2009 according to a report recently published by Mark Farrah Associates (MFA) in Healthcare Business Strategy, a popular industry analysis series.

The report looks at how managed Medicare plans fared during the recent open enrollment period when many introduced more conservative pricing and product designs. Though full results of the open market period will not be evident until February 1, 2009 data is released; analysis of January 2009 membership provides many interesting insights including:

--  Total Medicare Advantage (MA) enrollment as of January 1, 2009 stands
    at 10,421,393, with a net gain of 225,500 new members from October 2008 to
    January 2009. The 2% growth rate for the quarter was down from 3% for the
    same period one year ago
--  UnitedHealth Group and Humana together control more than 30% of the
    market, up 2% from one year ago.
--  Health Maintenance Organizations (HMO) and HMO Point of Service
    (HMOPOS) plans, with more than 6.6 million total Medicare Advantage
    members, remain by far the most popular type of MA option and had a gain of
    1.4% for the quarter.
--  Although there is a wide price range for these products, and many zero
    premium options, the average price for an HMO plan with prescription drug
    coverage is $35.21 per month.
--  Over 1,600 Private Fee for Service (PFFS) plan options were eliminated
    between 2008 and 2009.

Visit to read more about how the Medicare Advantage Market Matures. Subscriptions to Healthcare Business Strategy (BS) are free; visit our website to opt in.

About MFA

Mark Farrah Associates (MFA) is a data aggregator and publisher, focused primarily on the health insurance industry. MFA's products include Medicare Business Online™, the Health Coverage Portal™, Health Insurer Insights™, and Health Plans USA™. We serve a wide range of companies with interests in healthcare business analysis.

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