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State-Level Medicare Supplement Trends
A closer look at 2024 penetration, growth, and premium shifts by state.
Jared Strock, Riley Schinzel & Brett Mushett
May 22, 2025
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 📚 - State-Level Medicare Supplement Trends
Sponsor Snapshot 🚀 - brought to you by Quote Velocity
Compliance Chatter 📢 - Several new regulations to review!
It’s only a 5 minute read, but it will make you 10x smarter.
Here are IMPORTANT LINKS 🔗 for the week:
UnitedHealth under criminal probe for possible Medicare fraud, WSJ reports - (link)
CMS Innovation Center Strategy to Make America Healthy Again - (link)
May 13, 2025 - Important Update: Wellcare and Mutual of Omaha - (link)
When Star Ratings Backfire: How CMS Could Better Support Health In Medicare Advantage - (link)
Expect More Downside Risk in Medicare's Payment Models, CMS Official Says - (link)
Chart of the Day: Home Health Care Use Rose Among Medicare Beneficiaries With Dementia Until the Pandemic - (link)
Tracking the Trends: Historical Insights from Six Senior Hospital Indemnity Carriers - (link)
Jared’s recent LinkedIn posts:
DEEP DIVE 📚
State-Level Medicare Supplement Trends
Last week’s Deep Dive focused on the overall 2024 Medicare Supplement experience 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).
This week’s Deep Dive will remain in the MSIEE, but instead will focus on state level experience.
This analysis uses MSIEE data submitted to the NAIC. Some California-based carriers report to the CDMHC instead, which may explain differences in other data sources.
A quick refresher on the total Medicare Supplement market shows that 2024 total premium grew by over $2.2 billion (6.4%) and total lives grew by 130,000 (1.0%).
Premiums | Lives | |
2022 | $34,807,300,000 | 13,790,000 |
2023 | $35,342,900,000 | 13,610,000 |
2024 | $37,588,800,000 | 13,740,000 |
One thing to remember is that Medicare Supplement is regulated at the state level.
Therefore, different rules will govern how carriers can operate in each state. The strategy and tactics that lead to success in Nebraska will be completely different than those required in New York (as one example).
Medicare Supplement Penetration Rates
The first thing we’ll take a look at is the market penetration rates by state.
The penetration rate is calculated as:
[# of Medicare Supplement Lives] / [# of Medicare Beneficiaries]
Our numerator will be the Medicare Supplement lives from the 2024 MSIEE, which contains in force counts as of 12/31/2024.
The Centers for Medicare and Medicaid Services (CMS) releases monthly files that contain data about the number of Medicare Beneficiaries. Our denominator will be the number of Medicare beneficiaries from the December 2024 file. Using this file, the number of United States Medicare beneficiaries increased by 1.48 million (2.3%) in 2024.
Using this calculation, the nationwide Medicare Supplement penetration rate is 20.5% as of year-end 2024, which is down from 20.8% in 2023.
The map below shows the Medicare Supplement penetration rate by state. The darker shading represents the highest penetration rates while the lighter shading represents the lowest penetration rates.
Observations:
The top 5 states with the highest penetration rates are Wyoming (48%), Kansas (44%), Iowa (43%), Nebraska (43%), and Montana (38%). These 5 states were also the top 5 from 2023. Combined, these states have 2.1 million Medicare beneficiaries (3.1% of US total) and 884,647 Medicare Supplement lives (6.4% of US total).
The 5 states with the lowest penetration rates are Hawaii (4%), California (9% - but keep in mind the reporting note from the introduction), New York (12%), Washington D.C. (13%), and Alabama (15%). Combined, these states have 12.4 million Medicare beneficiaries (18.6% of US total) and 1,271,982 Medicare Supplement lives (9.3% of US total).
There are 31 states that have a Medicare Supplement penetration rate that is above the nationwide average of 20.5%, and 20 states (including Washington D.C.) that are below the average.
The 31 states with higher than the nationwide average Medicare Supplement penetration rate represent 32.5 million Medicare beneficiaries (48.5% of US total) and 8.4 million Medicare Supplement lives (61.1% of US total). The remaining 20 states comprise 34.5 million Medicare beneficiaries (51.5% of US total) and 5.3 million Medicare Supplement lives (38.9% of US total).
A state-by-state pdf breakdown can be downloaded below:
|
Medicare Supplement Total In Force Lives
The following table includes the top and bottom 5 states in terms of total in force Medicare Supplement lives:
Rank | Issue State |
| In Force Lives | % of Total |
1 | Texas |
| 968,823 | 7.1% |
2 | Florida |
| 937,353 | 6.8% |
3 | Illinois |
| 755,576 | 5.5% |
4 | Pennsylvania |
| 684,627 | 5.0% |
5 | California |
| 623,117 | 4.5% |
47 | North Dakota |
| 50,422 | 0.4% |
48 | Rhode Island |
| 38,047 | 0.3% |
49 | Alaska |
| 22,522 | 0.2% |
50 | Hawaii |
| 13,775 | 0.1% |
51 | Washington D.C. |
| 12,208 | 0.1% |
| All Others |
| 9,625,334 | 70.1% |
Observations:
The top 5 states of Texas, Florida, Illinois, Pennsylvania, and California. These states are consistent with 2023, except California replaced Ohio for 2024. These 5 states represent 28.9% of the total Medicare Supplement lives.
The bottom 5 states of North Dakota, Rhode Island, Alaska, Hawaii, and Washington D.C. These states are consistent with 2023 except that North Dakota replaced Vermont for 2024. These 5 states represent 1.0% of the total Medicare Supplement lives.
The state that added the most lives in 2024 was California with 24,345 (4.1% growth). The state with the highest growth percentage was Oregon at 7.9% (14,626 lives).
The state that reduced by the most lives in 2024 was North Carolina with 11,362 (-2.4% reduction). The state with the lowest growth percentage was Rhode Island at -14.3% (-6,347 lives).
Medicare Supplement Total Earned Premium
The following table includes the top and bottom 5 states in terms of total Medicare supplement earned premium:
Rank | Issue State |
| Earned Premium | % of Total |
1 | Florida |
| 2,769,794,428 | 7.4% |
2 | Texas |
| 2,627,096,657 | 7.0% |
3 | Illinois |
| 2,148,194,067 | 5.7% |
4 | California |
| 1,758,354,225 | 4.7% |
5 | Pennsylvania |
| 1,743,992,458 | 4.6% |
47 | Vermont |
| 136,195,004 | 0.4% |
48 | Rhode Island |
| 119,370,784 | 0.3% |
49 | Alaska |
| 53,698,819 | 0.1% |
50 | Hawaii |
| 33,183,329 | 0.1% |
51 | Washington D.C. |
| 30,905,990 | 0.1% |
| All Others |
| 26,142,426,708 | 69.6% |
Observations:
The top 5 states of Florida, Texas, Illinois, California, and Pennsylvania. These states are consistent with 2023, except California and Pennsylvania swapped spots this year. These 5 states represent 29.4% of the total Medicare Supplement earned premium.
The bottom 5 states of Vermont, Rhode Island, Alaska, Hawaii, and Washington D.C. These states are consistent with 2023, including the order. These 5 states represent 1.0% of the total Medicare Supplement earned premium.
The state that added the most earned premium in 2024 was Texas with over $225.4 million (9.4% growth). The state with the highest growth percentage was Vermont at 15.5% ($18.3 million).
The state that added the least amount of earned premium in 2024 was Washington D.C. with $1.5 million (5.2% growth). The state with the lowest growth percentage was Alabama at 1.5% ($6.2 million).
Enjoying the recent Medicare Supplement Deep Dives? Stay tuned as we’ll keep providing insights in the future!
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