The Growth of Private Plans in Medicare, 2006

Publication Date: March 2006

Publisher: Henry J. Kaiser Family Foundation


Research Area: Health

Type: Brief

Coverage: United States


The Growth of Private Plans in Medicare, 2006, details the different types of private plan options available to people on Medicare. These include Medicare Advantage plans (such as Medicare HMOs, PPOs and private fee-for-service plans) and new stand-alone prescription drug plans.

• In 2006, all Medicare beneficiaries have access to at least one type of private Medicare Advantage plan, up from 77% in 2004. The increase in access stems largely from the creation of new Medicare regional PPOs and the expansion of private Medicare fee-for-service plans. About 13% of Medicare beneficiaries (5 million) are enrolled in private Medicare Advantage plans.

• The introduction of regional PPOs in 2006 and the growth in private fee-for-service plans have expanded access to private plans in rural areas, but HMOs continue to be more common in urban areas. Medicare HMOs are not offered in eight states: Alaska, Delaware, Maine, Montana, North Dakota, South Dakota, Vermont and Wyoming.

• Special needs plans are available in all but nine states. These plans serve beneficiaries who are eligible for Medicare and Medicaid, institutionalized beneficiaries and those with severe, chronic, and/or disabling conditions.