Medicare Supplement 2012–2020 Market Projection

  • Originally published March 14, 2011 , last updated January 12, 2016
  • Medicare
Medicare Supplement 2012–2020 Market Projection

According to research from CSG Actuarial, the Medicare Supplement market shows potential for long-term growth, despite declines in overall enrollments over the last five years — which were due mostly to the implementation of the Medicare Advantage program.

CSG predicts total Medicare Supplement enrollments will increase from 10 million in 2011 to over 13.5 million in 2020.

Medicare Supplement Enrollment

Year Total Policies Inforce % of Medicare Beneficiaries
2012 10,436,000 20.6%
2013 10,723,000 20.5%
2014 10,997,000 20.3%
2015 11,366,000 20.4%
2016 11,759,000 20.5%
2017 12,190,000 20.7%
2018 12,634,000 20.9%
2019 13,125,000 21.1%
2020 13,633,000 21.3%

Source: CSG Actuarial

CSG's research identified four primary reasons to expect growth, including:

1. Growing population of Medicare eligibles

The number of Medicare eligibles will increase by 15.4 million people from 2011 to 2020.


Total Beneficiaries

% Increase

2011 48,685,000 2.1%
2012 50,695,000 4.1%
2013 52,426,000 3.4%
2014 54,085,000 3.2%
2015 55,679,000 2.9%
2016 57,259,000 2.8%
2017 58,871,000 2.8%
2018 60,531,000 2.8%
2019 62,252,000 2.8%
2020 64,036,000 2.9%

Source: CSG Actuarial

2. MA shakeout — The Affordable Care Act includes several provisions that, if upheld, could make some Medicare Advantage plans less competitive due to lower payments to the carriers.

3. Group plans disappearing — Many companies and municipalities are eliminating their group retiree health care benefits, forcing many individuals onto Medicare.

4. New Medicare Supplement Plans — The Affordable Care Act calls for the NAIC to research new Medicare Supplement plans that would be introduced in 2014.

You can download CSG Actuarial’s research paper here.

Here are four more reasons we at Senior Market Sales are optimistic about the future of Medicare Supplement:

5. Seniors love it — According to a 2009 survey from America's Health Insurance Plans (AHIP), 88% of Medicare Supplement policyholders are satisfied with their coverage and 87% would recommend it to a friend.

6. It’s great for cross-selling Medicare Supplement attracts prospects who, generally speaking, are healthy enough to clear underwriting and typically have some assets — since they’re willing and able to pay an average of $2,000 a year in Med Supp premiums. Therefore, Medicare Supplement buyers are often great prospects for other senior insurance products, like life insurance, long-term care insurance and annuities.

7. Growing acceptance of electronic applications Senior Market Sales agents submitted more than 10,000 Medicare Supplement apps electronically in 2010, amounting to annualized premium exceeding $13.5 million! These numbers are evidence that your clients and your fellow agents are more comfortable with technology than ever before.

Why is this cause for optimism? Electronic Medicare Supplement applications speed up your enrollments, reduce incompletes and errors, expand your sales territory, and eliminate the cost of mailing and the hassle of ordering and waiting for supplies.

8. New agents entering the market — Every day we talk to agents who are leaving the under-65 market because of changes imposed by the Affordable Care Act. If you’re new to the senior market and thinking about selling Medicare Supplement, be sure to watch our webinar New to Medicare? Essential Knowledge and Tools for New Medicare Agents.