Here is what you’ll find in this week’s newsletter!
Important links 🔗 - the best articles we found this week about the Medicare Market along with links to Jared’s recent LinkedIn posts.
Deep Dive 📚 - 2025 Medicare Supplement Market Results
Sponsor Snapshot 🚀 - brought to you by VRI
It’s only a 5 minute read, but it will make you 10x smarter.
Here are IMPORTANT LINKS 🔗 for the week:
Academy: Timely Congressional Action on Social Security’s Financial Shortfall Needed to Avoid Sharper Reforms in Coming Years - (link)
What the 2027 Medicare Advantage & Part D Final Rule Means for Insurance Agents - (link)
Medicare: CMS’s Use of Data Analytics to Identify and Prevent Fraud - (link)
Policy Expert Believes CMS is Taking “Adversial Posture” to Medicare Advantage - (link)
A new Medicare program that uses AI for prior authorizations is hurting patients and delaying care - (link)
Oncology Care Model Tied to Reduced Chemotherapy, Lower Medicare Spending in Poor-Prognosis Cancers - (link)
New Plan Could Speed Medicare Coverage for Innovative Devices - (link)
InterMed drops Martin’s Point Medicare Advantage plans starting in 2027 - (link)
Medicare Advantage Improvement Act of 2026 Introduced - (link)
Jared’s recent LinkedIn posts:
DEEP DIVE 📚
2025 Medicare Supplement Market Results
This week’s Deep Dive is all about Medicare Supplement, an important and popular product within the Medicare ecosystem.
Our focus will be on the experience data sourced from the Medicare Supplement Insurance Experience Exhibit (MSIEE), which carriers provided within their Annual Statements submitted to the National Association of Insurance Commissioners (NAIC).
The MSIEE contains Premium, Claims and Covered Lives experience data and is split by Plan, Issue State and “New Business” vs “Seasoned Business”. The New Business refers to business that was issued within the most recent three calendar years. This means 2025 New Business experience reflects policies that were issued from 2023 to 2025 while the 2025 Seasoned Business represents policies issued in 2022 and prior.
Companies that have Medicare Supplement business are required to complete the MSIEE as part of their Annual Statement submission. It is subject to change throughout the year as additional carriers report or correct previously submitted data.
Additionally, there are some companies that report to the California Department of Managed Healthcare (CDMHC) and are not required to submit the MSIEE to the NAIC. The data presented here utilizes the data as it was received from the NAIC with the exception of 2023-2025, where additional sources have been incorporated.
2025 Total Market Results
The following table shows the total market results for the past three years.
The following graph shows total loss ratios for the past 10 calendar years:
Key statistical takeaways:
Premiums grew by over $3.39 billion from 2024 to 2025. The growth rate of 8.8% was double the 4.4% realized from 2023 to 2024.
Claims increased by $3.30 billion from 2024 to 2025, which establishes a new high mark for a one-year jump. The 10.1% increase in 2025 claims was nearly double the 5.1% growth from 2023 to 2024.
Covered Lives increased by 240,000, representing a 1.7% increase from 2024. This represents a return to growth as total Covered Lives was flat from 2023 to 2024.
The Loss Ratio increased by 1.0% from 2024 to 2025. This marks the 5th consecutive year that the loss ratio has increased. Prior to the COVID-impacted 2020, the loss ratio has not decreased since it dropped by 0.1% in 2017.
What is driving these results?
The increase in Premium is largely attributable to the regular annual premium increases on Medicare Supplement policies. These increases come in two forms: (1) Many plans have premiums that are based on the current age of the policyholder, so they automatically increase every year; and (2) Carriers pursue premium increases every year to account for medical trend and experience deviations. Related to the latter point, the increasing loss ratios in recent years has led to carriers filing for higher premium rate increases. More information on those higher rate actions can be found here.
The increase in Claims and subsequent Loss Ratio is primarily driven by the combination of higher costs and higher utilization of benefits by policyholders. When combined, recent years’ experience has demonstrated annual Medicare Supplement Claims trend in double digits. You can read more about that here.
The overall increase in Lives is a result of a couple factors:
As you will see later in this deep dive, the total Lives count is being propped up by a substantial increase in the New Business Lives. Medicare Advantage plans continue to experience strong growth. However, several components such as carrier exits, high loss ratios, plan terminations and service area reductions, and plans going non-commissionable are making these plans less favorable to policyholders and agents. More on all of this here. This disruption is likely leading to more individuals electing (or returning) to Original Medicare and purchasing a Medicare Supplement. Additionally, numerous states are updating their Medicare Supplement regulations to include Anniversary and Birthday rules. These rules allow existing Medicare Supplement policyholders to change their plans without having to undergo medical underwriting. More on this here.
While the New Business lives experienced growth, the Seasoned business experienced a decrease. Some of this decrease is likely attributable to the higher premium rate increases noted above. When factoring in the components of owning a Medicare Supplement policy (e.g., Part B premium, Part D premium, copays/deductibles), affordability is likely leading to individuals to forego their Medicare Supplement for a lower cost alternative Medicare Advantage plan. Additionally, with the expansion of Anniversary and Birthday rules noted above, it is likely that long-term Medicare Supplement policyholders were able to obtain a new policy, shifting them into the New Business Lives in 2025.
2025 New Business Results
The following table shows the New Business market (2025 reflects policies issued in 2023-2025) results for the past three years.
The following graph shows New Business loss ratios for the past 10 years:
Key statistical take-aways:
The $8.0 billion of New Business premium represents approximately 19% of the total market premium and a nearly $1.7 billion increase from 2024. This is the highest New Business premium total since 2021. This increase in premium is likely driven by individuals leaving Medicare Advantage plans, higher rate increases in the Medicare Supplement market, and states’ expansion of Medicare Supplement Birthday and Anniversary rules.
Covered Lives for the New Business cohort increased by 580,000, representing a 15.3% increase from 2024. This is the first increase in this cohort since 2019. Going back to 2007, the 15.3% growth is the highest one-year increase for this cohort. Like the New Business premium, this increase is likely driven by individuals leaving Medicare Advantage plans and states’ expansion of Medicare Supplement Birthday and Anniversary rules.
The Loss Ratio increased by 0.5%. While this is larger than 0.1% decrease realized in 2024, it is significantly lower than the Loss Ratio increases between 2021 and 2023 (2.7%-6.3%) in the aftermath of the COVID impacted 2020 when the Loss Ratio was materially suppressed.
2025 Seasoned Business Results
The following table shows the Seasoned Business market (2025 reflects policies issued in 2022 and prior) results for the past three years.
The following graph shows Seasoned Business loss ratios for the past 10 years:
Key statistical takeaways:
The $33.9 billion Seasoned Business premium represents approximately 81% of the total market premium and a 5.4% increase from 2024. This is down from the 7.6% premium growth realized in 2024. This increase in premium is likely heavily influenced by the higher rate increases taken in the market given the decrease in Lives.
Covered Lives for the Seasoned Business cohort decreased by 340,000, representing a 3.3% decrease from 2024. This undid a good portion of the 4.1% increase (410,000 Lives) realized in 2024.
The Loss Ratio increased by 0.9% from 2024 to 2025, which matches the increase from 2023 to 2024. Going back to 2006, the 84.2% Loss Ratio is a new high for this cohort of business. This marks the 5th consecutive year that the Loss Ratio has increased. The continually increasing Loss Ratio is one of the underlying culprits that has led to the higher rate increases in recent years.
With the changes occurring throughout the entire Medicare ecosystem, the next few years will be interesting as both the Medicare Supplement and Medicare Advantage markets will be ripe with both opportunities and challenges. How do you think it all plays out?
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What MMI + Subscribers read this week…
Insurance Regulatory Insights April 2026 - 🎂Birthday Rules coming to NM and WV. (link)
April ‘26 MA/MAPD and PDP enrollment data - April enrollment data has been loaded. Here are a few observations. (link)
Broker/Agent MA Commissions Increasing in 2027 - A look at historical MA/MAPD agent comp., and what to expect in 2027. (link)
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