The Availability of Optional Benefits in Medicare Advantage (MA) Plans in Rural and Urban Areas and the Implications for MA Payment Policy

Research center:
Lead researcher:
Project funded:
September 2019
Project completed:
February 2021

Medicare Advantage (MA) plans continue to gain market share in rural and urban areas across the country with 23.5% and 35.7% enrolled in March 2017, respectively. Historically, individuals in urban areas have experienced more choice of MA plans than those in rural areas and are more likely to have access to a zero-premium MA plan. In recent years, many MA plans have added extra covered services to their beneficiaries' benefits, including dental, vision, and fitness programs with 62%, 77% and 69% of beneficiaries receiving these benefits respectively.

Plans are required to spend a minimum of 85% of their total payment received on enrollee benefits, which coupled with the other changes, has caused a significant increase in the extra benefits that are being offered to beneficiaries in general. However, since rural beneficiaries do not have the same access to plans with zero premiums, it is likely that they are also offered fewer of these extra benefits.

We tested for a correlation between presence of zero premiums and offering additional benefits (the later defined as "any" and as "more than x," with sensitivity analysis around the number). This may cause a significant disparity in the overall value of the MA benefit that rural and urban MA enrollees receive. The goals of this project were to describe the differences in MA plans available to rural and urban beneficiaries, to assess the impact that payment policy has on the development of these differences, and to suggest payment policy modifications that could ameliorate any disparities.


  • Availability of Supplemental Benefits in Medicare Advantage Plans in Rural and Urban Areas
    Policy Brief
    RUPRI Center for Rural Health Policy Analysis
    Date: 02/2021
    This brief identifies differences in Medicare Advantage (MA) plans that include supplemental benefits available to rural and urban enrollees. By better understanding the variation in MA plan offerings across the country, policymakers can take appropriate action to improve the value of plans available in rural regions.