Enrollment in Medicare Advantage, the private plan alternative to traditional Medicare, has increased steadily since 2010. The average beneficiary has access to 34 Medicare Advantage plans with prescription drug coverage in 2025, double the number available in 2018. On average, Medicare beneficiaries have access to plans offered by 8 firms, a slight increase from 2018. One goal of offering Medicare coverage through private plans is to leverage competition with the idea that insurers will compete to provide better benefits and lower costs to attract and retain enrollees. However, recent analysis finds that Medicare Advantage markets are highly concentrated, suggesting that the growth in enrollment and plan availability has not occurred in the context of a competitive market.
Higher market concentration in Medicare Advantage insurance markets may lower the incentive for insurers to compete for potential enrollees by making plans more appealing through more comprehensive benefits or lower costs. However, the competitiveness, or lack thereof, of Medicare Advantage markets has not been a priority of policymakers or regulators, especially in recent years. The most recent activity at the federal level occurred in 2017 when the Department of Justice blocked a merger between insurers Aetna and Humana, arguing if it went through it would significantly raise market concentration in the Medicare Advantage market. More recently, the conversation regarding competition in health care has revolved around increased consolidation in provider markets, especially hospitals and health systems.
To examine the competitiveness of Medicare Advantage markets, this analysis uses publicly available, county-level Medicare Advantage plan information and enrollment data for all 50 states, D.C., and Puerto Rico, published by the Centers for Medicare and Medicaid, to calculate the Herfindahl-Hirshman Index (HHI) for each market (a county is considered a Medicare Advantage market because plans are offered at the county level). The HHI uses the relative market shares of all Medicare Advantage insurers offering plans in a county to create a measure of market concentration. Counties are then classified as unconcentrated, moderately concentrated, highly concentrated, or very highly concentrated markets. These categories align with guidelines published by the Federal Trade Commission and U.S. Department of Justice, except in that a fourth category (very highly concentrated) is added to further discern differences within the most concentrated markets. This analysis also examines how often one or two Medicare Advantage insurers enrolled at least half of all enrollees within a county, which provides an alternative illustration of market concentration (See Methods for more details).
Key Takeaways
- Virtually all counties were highly concentrated (79%) or very highly concentrated (18%) in 2024. Less than 1% were moderately concentrated and 0% of counties were unconcentrated. (2% of counties had low or no Medicare Advantage enrollment.)
- Most (89%) Medicare Advantage enrollees were in highly concentrated markets, with another 4% of Medicare Advantage enrollees in very highly concentrated markets.
- Medicare Advantage markets were more concentrated in rural counties than in urban counties: 39% of the most rural counties were very highly concentrated in 2024 compared with 15% of rural counties that were near urban areas and 6% of urban counties.
- Nine in ten (90%) Medicare beneficiaries lived in a county where at least half of all Medicare Advantage enrollees were in plans sponsored by one or two insurers in 2024.
- UnitedHealthcare (41%) or Humana (25%) had the highest enrollment in two-thirds of counties, which comprised 59% of all Medicare Advantage enrollment, in 2024. Among all Medicare Advantage insurers, UnitedHealthcare was the dominant insurer in the largest share of highly concentrated markets (41%) and very highly concentrated markets (50%) in 2024.
- In more than four in ten counties (44%), comprising 22% of all Medicare Advantage enrollment, a single Medicare Advantage insurer had at least 50% of enrollment in 2024, including 22% of counties where UnitedHealthcare had at least 50% of enrollment and 10% of counties where Humana had at least 50% of enrollment. Some large counties where one insurer had at least 50% of enrollment include Dallas County, Texas (55%), Salt Lake County, Utah (52%), and Milwaukee County, Wisconsin (64%).
Virtually all Medicare Advantage insurance markets were highly concentrated (79%) or very highly concentrated (18%) in 2024.…