2024 combined benefits in Medicare Advantage: Tracking benefit strategy and options

Executive summary

Combined benefits in Medicare Advantage (MA) have become increasingly popular in recent years. Combined benefits, or “combo benefits,” are offered to beneficiaries as a distinct set of benefits combining different types of supplemental benefits—that is, different service categories in the Plan Benefit Package (PBP)—into one “package” or “purse.” This structure allows plans to combine supplemental benefits into groups with a maximum plan benefit amount, in either number of visits or a dollar limit per period. One popular combo benefit is a “dental-only package,” which offers preventive and comprehensive dental services under a combined maximum benefit limit, typically called a shared dental limit. The focus of this paper, however, is on non-dental-only combo packages, which we refer to as “true combo packages.” These packages incorporate multiple types of unrelated benefit types and seamlessly function as a payment for various needs, providing beneficiaries the flexibility to choose the services most significant to them. An example of a true combo package is a plan offering a dollar limit over a specified time period covering services like dental, vision, and hearing.

This paper expands on last year’s article on this topic by highlighting common package groupings and non-uniform benefits¹ included in true combo benefits. We present a summary of true combo benefits in 2024 and outline five key takeaways from the nationwide MA landscape:

1. The prevalence of true combo benefit package offerings increased from 34% to 55% from 2023 to 2024 and grew across all market segments. Medicare Advantage organizations (MAOs) continue to focus on providing benefits that allow beneficiaries the flexibility to choose how they spend their money. True combo benefit coverage in dual-eligible special needs plans (D-SNPs) is 87% in 2024.
2. The most frequently offered true combo benefit group among general enrollment plans in 2024 consists of over-the-counter (OTC) benefit cards paired with another benefit such as acupuncture, personal emergency response system, or home and bathroom safety devices. Dental benefits combined with vision and/or hearing benefits follows as the second-most common grouping.
3. In the D-SNP landscape, 83% of beneficiaries are enrolled in plans with true combo benefit packages that include non-uniform benefits, such as allowances for groceries and utilities.
4. The average annualized limits increased in 2024 for true combo benefits, including non-uniform benefits, OTC benefit card, and dental, vision, and hearing benefits.
5. All D-SNPs and chronic condition special needs plans (C-SNPs) that offer non-uniform benefits in a true combo benefit package cover at least one benefit related to nonemergency transportation, food/grocery, or general living support.

National³ organizations are more likely to offer true combo benefits to their beneficiaries than regional organizations in 2024, with coverage of 57% (national) and 50% (regional). This is a shift from 2023, when true combo benefits were more prevalent with regional MAOs than national. National MAOs drive trends in the special needs plan (SNP) market, with a national MAO leading the significant increase in the institutional SNP (I-SNP) true combo coverage observed in 2024.

Beneficiaries enrolled in D-SNPs are the most likely to have true combo benefits in 2024 with 87% benefit prevalence, relative to beneficiaries in other SNPs and general enrollment plans.

Over half of all MA beneficiaries in the market have access to a true combo benefit package in 2024, suggesting a strong desire to provide flexible benefits across all market segments.

OTC benefit card and home and bathroom safety coverage in combo packages increased by 25% or more from 2023 to 2024. A single large national MAO offering an OTC benefit card combined with home and bathroom safety drove this increase. Non-uniform benefit prevalence in true combo packages also increased by 8%.

Dental, vision, hearing, and acupuncture coverage in combo packages dropped slightly across the market from 2023 and 2024. The prevalence of vision hardware, hearing hardware, and acupuncture coverage as standalone benefit offerings also decreased slightly from 2023 to 2024, driven by a single large national organization switching its vision and hearing benefits from mandatory supplemental benefits to optional supplemental benefits on many plans in 2024. If this organization was excluded from the results, the prevalence of hearing and vision in combined benefits would increase slightly from 2023 to 2024. The prevalence of dental coverage did not decrease from 2023 to 2024, so while some plans chose not to provide dental coverage in true combo benefits in 2024, they did not remove dental coverage in general.

The following graphs examine the most common groupings of benefits within a true combo benefit. We grouped all combo benefit structures in the market into a distinct category and display seven of the most popular categories in 2024.

The prevalence of OTC benefit cards in true combo benefits surged from 2023 to 2024. The OTC + Other Benefits category is driven by a single large national carrier combining an OTC benefit card with home and bathroom safety devices. While the prevalence of dental plus vision and/or hearing combos decreased from 2023 to 2024, some of this is explained by the increase in plans offering dental plus vision and/or hearing plus OTC benefit card combos.

Regional MAOs tend to have more variation in their combined benefit offerings than national MAOs. Regional MAOs offer dental, vision, and hearing, OTC and non-uniform benefits, OTC and fitness, and acupuncture and chiropractic combined benefits more often other than national MAOs.

National MAOs are focused on combined benefits with OTC and other benefits, which is largely driven by a single carrier offering OTC with home and bathroom safety. They also offer dental, vision, hearing, and transportation combo packages more often than regional MAOs.

The average annualized limit for true combo packages covering OTC plus non-uniform benefits more than tripled from 2021 to 2024. This change is driven by D-SNPs and national MAOs in the market enriching their non-uniform benefits combined with OTC.

Average limits for all other true combo packages including OTC steadily increased from 2022 to 2024. The 2021 average limit was also high relative to 2022 and 2023, but a smaller number of combo benefits offered in 2021 results in a small number of high-limit packages impacting the average significantly.

The average limit for the Dental, Vision, Hearing Packages grouping increased from 2021 to 2024, with the largest increase from 2021 to 2022 and smaller increases in subsequent years. Figure 3 above shows that the prevalence of the Dental, Vision, Hearing Packages grouping decreased in 2024, but Figure 5 shows the remaining packages continue to increase their dollar limits.

Food/grocery card and general living support are the two most popular non-uniform benefits offered in a true combo benefit, with over 75% prevalence among D-SNPs and C-SNPs. General living support benefits typically provide an allowance for rent and/or utilities. General enrollment plans also offer these benefits, but at a lower prevalence relative to the other SNP types, which is due to differences in target populations. Beneficiaries must meet specific eligibility criteria for non-uniform benefits, such as low socioeconomic status or certain chronic conditions outlined by the plan. General enrollment plans tend to have fewer members who will meet the eligibility criteria, making these benefits less attractive to offer.

Beginning in 2025, MAOs participating in the VBID program will be required to offer supplemental benefits aimed at addressing health-related social needs across two out of three health-related social needs areas: food insecurity, transportation challenges, and housing instability and/or living environment concerns.⁴ This could lead to further growth in the prevalence of food/grocery, utilities, and transportation benefits.

2025 MA bid considerations

As the 2025 bid deadline approaches, plans should carefully consider the following aspects when approaching benefit selection and refining bid strategy:

• Beneficiary focus: Plans should consider prioritizing benefits that directly address the needs of their beneficiaries (such as designing benefits to support chronically ill populations or benefits that provide preventive care value beyond just a cash value) or offer flexibility among packages to accommodate a diverse demographic. Additionally, plans should develop clear and concise educational materials that communicate new or existing combined benefit offerings, allowing beneficiaries to make informed decisions.
• Competitive benchmarking: Identify key benefit coverages in a plan sponsor’s targeted regions to determine the plan’s competitive positioning. Understanding which services are covered, and how, by a competitor’s combined benefit package enables plan sponsors to remain competitive in a dynamic market with an increasingly complex menu of benefits. Of note, national MAOs provide true combo coverage to the majority of MA beneficiaries.
• Compliance and regulatory alignment: The Centers for Medicare and Medicaid Services (CMS) recently updated Part C reporting requirements (effective January 1, 2024) that require MAOs to submit supplemental benefit utilization and cost information for all supplemental benefits.^5,6 As it relates to combo packages, the Health Plan Management System (HPMS) memo of February 21, 2024, states that MAOs “must separate out spending by category and submit an Electronic Data Record (EDR) for each category in which there was utilization.” Plans should engage with their vendors, providers, and internal systems to ensure adequate requirements are in place for 2024 and beyond.
• 2025 proposed rule mid-year notifications: The 2025 proposed rule⁷ included a provision that plan sponsors must notify their beneficiaries of their unused supplemental benefits, and how to use them, if the beneficiary has not utilized the benefit at all by midyear. This is an additional administrative burden for plans and benefit vendors, which could increase benefit utilization.

Methodology and assumptions

To perform these analyses, we relied on detailed information on MA plan combo benefit offerings for 2024. We also used publicly available MA enrollment information from February of each year, with the exception of 2024, for which we relied on January 2024 enrollment, to develop the enrollment-weighted averages by the groupings noted above.

The various groupings we analyzed include:

• Special needs plan type
• Regional versus national organizations

The values presented reflect plans available in 2024. The information released by CMS includes detailed cost-sharing information by PBP service category, enrollee premium, and enrollment by plan. We used the 2024 Milliman MACVAT® (which summarizes the previously mentioned information released by CMS).

We included all individual plans, e.g., non-employer group waiver plans (non-EGWPs), MA prescription drug (MAPD) plans. We excluded standalone prescription drug plans (PDPs), medical savings account (MSA) plans, Medicare-Medicaid plans (MMPs), Program for All-Inclusive Care of the Elderly (PACE) plans, Part B-only plans, PFFS, and Cost plans.

Caveats, limitations, and qualifications

Mary Yeh and Ivan Yen are actuaries for Milliman, members of the American Academy of Actuaries, and meet the qualification standards of the Academy to render the actuarial opinion contained herein. To the best of their knowledge and belief, this report is complete and accurate and has been prepared in accordance with generally recognized and accepted actuarial principles and practices.

The material in this report represents the opinion of the authors and is not representative of the view of Milliman. As such, Milliman is not advocating for, or endorsing, any specific views contained in this report related to the Medicare Advantage program.

The information in this report is designed to provide an overview of the 2024 Medicare Advantage combo benefit offerings. This information may not be appropriate, and should not be used, for other purposes. We do not intend this information to benefit any third party that receives this work product. Any third-party recipient of this report that desires professional guidance should not rely upon Milliman’s work product but should engage qualified professionals for advice appropriate to its specific needs. Any releases of this report to a third party should be in its entirety.

The credibility of certain comparisons provided in this report may be limited, particularly where the number of plans in certain groupings is low. Some metrics may also be distorted by premium and benefit changes in a few plans with particularly high enrollment.

In preparing our analysis, we relied upon public information from CMS, which we accepted without audit. However, we did review it for general reasonableness. If this information is inaccurate or incomplete, conclusions drawn from it may change.

¹ Non-uniform benefits include Value-Based Insurance Design (VBID), Special Supplemental Benefits for the Chronically Ill (SSBCI), and Uniformity Flexibility (UF) benefits. These benefits target subsets of the MA population and are designed to promote value-based care and enhance benefit offerings.

² Figures 1 to 6 exclude private fee-for-service (PFFS) plans, Cost plans, medical savings account (MSA) plans, and Medicare-Medicaid Plans (MMPs) because these plans have limited enrollment and subsequent limited offerings of combo benefits.

³ We classified the following organizations as national: Centene/WellCare, Cigna, CVS Health/Aetna, Elevance Health/Anthem, Humana, Kaiser, and UnitedHealth, with the remainder of plans identified as regional.

⁴ CMS. Medicare Advantage Value-Based Insurance Design Model Extension Fact Sheet. Retrieved March 31, 2024, from https://www.cms.gov/priorities/innovation/vbid-extension-fs.

⁵ CMS (January 1, 2024). Medicare Part C Reporting Requirements. Retrieved March 31, 2024, from https://www.cms.gov/files/document/cy2024-part-c-reporting-requirements-01092024.pdf.

⁶ HPMS memo sent on February 21, 2024, titled “Submission of Supplemental Benefits Data on Medicare Advantage Encounter Data Records.”

⁷ CMS (November 26, 2024). Fact Sheet: Contract Year 2025 Policy and Technical Changes to the Medicare Advantage Plan Program, Medicare Prescription Drug Benefit Program, Medicare Cost Plan Program, and Programs of All-Inclusive Care for the Elderly, and Health Information Technology Standards. Retrieved March 31, 2024, from https://www.cms.gov/newsroom/fact-sheets/contract-year-2025-policy-and-technical-changes-medicare-advantage-plan-program-medicare.