Anticipating open enrollment season for coverage in 2019, the Centers for Medicare and Medicaid Services (CMS) released coverage and premium information that will factor into consumer decisions about Medicare and individual commercial plans offered through exchanges. Enrollment and premium trends also inform regulatory and broader policy decisions at both federal and state levels.

On October 12, CMS announced the 2019 premiums, deductibles and coinsurance amounts for Medicare Parts A and B. The Medicare Open Enrollment period began October 15 and will run through December 7, 2018.

In 2019, the standard monthly premium for Medicare Part B (mostly physician and outpatient services) will increase to $135.50 from $134 in 2018. The annual deductible for Medicare Part B beneficiaries in 2019 will rise to $185 from $183 in 2018.

The Medicare Part A (mostly inpatient hospital and skilled nursing facility services) inpatient deductible will increase to $1,364 from $1,340. According to CMS, roughly 99 percent of Medicare beneficiaries do not have a Part A premium since they have at least 40 quarters of Medicare-covered employment.

Medicare Advantage: Enrollment to Reach Record High as Premiums Decline

Changes in Medicare Part A and Part B premiums and deductibles do not directly affect premiums and deductibles for Medicare Advantage and Medicare Prescription Drug (Part D) plans. In Medicare Advantage for 2019, CMS is projecting a continued decline in monthly premiums to $28.00 on average, a drop of $1.81. Medicare Advantage premiums have declined steadily since 2015, when the average monthly premium was $32.91.

CMS projected 83 percent of current Medicare Advantage enrollees who stay with their current coverage in 2019 will see their premium stay the same or decline.

As Medicare Advantage premiums continue to fall, enrollment continues to rise. CMS is expecting Medicare Advantage enrollment to jump 11.5 percent to an all-time high of 22.6 million beneficiaries. More than 36 percent of all Medicare beneficiaries will be enrolled in Medicare Advantage plans next year.

The number of Medicare Advantage plans available in the market nationally for 2019 is also increasing—to roughly 3,700, up from approximately 3,100 in 2018, according to CMS. The growth of the plans will ensure that 91 percent of Medicare beneficiaries have access to at least 10 Medicare Advantage health plans in their geographic area.

The monthly premium for basic Medicare Part D coverage also continues to decline. For 2019, the basic premium is expected to drop 3.2 percent to $32.50 monthly.

Individual Commercial Insurance Market Also Sees Average Premium Decline

CMS also released data showing premium reductions in 2019 for individual coverage offered on federally-facilitated exchanges. For the first time, the average monthly premium for the benchmark plan (the second-lowest cost silver plans) will decline, to $406, a 1.5 percent reduction from 2018. Average premium changes by state for 2019 range from a reduction of 26.2 percent in Tennessee to an increase of 20.2 percent in North Dakota.

Last year, benchmark plan rates across all states, on average, increased 36.9 percent, and 25.4 percent the year before that. The benchmark plan is significant because it is the plan used to calculate the amount of premium subsidies provided under the Affordable Care Act.

In 2019, 23 additional qualified health plan issuers will participate in the federal exchange, and 29 will expand their service areas, reversing a decline over the past two years. As a result, 61 percent of counties served by the federal exchange will have access to more than one insurer, an increase from 44 percent in 2018.

Open Enrollment on the federal exchange runs from November 1 through December 15, 2018, for coverage effective January 1, 2019.

Husch Blackwell attorneys continue to monitor changes in Medicare and commercial coverage and regulatory developments that affect consumers, providers and other market participants. For more information, please contact a member of the Husch Blackwell Law Team.