Annual gross margins of Medicare Advantage plans averaged $1,608 per covered person between 2016 and 2018–about double the gross margins for the ACA and employer-based group markets.
As some presidential candidates have begun proposing Medicare Advantage-type plans as a way to implement Medicare for All, a new study finds those plans are likely more profitable for private insurers than employer-sponsored plans or the plans on Obamacare’s individual market.
The report by the Kaiser Family Foundation (KFF) looked not at actual profits—since these different models have different levels of administrative costs—but at gross margins, the difference between premiums taken in and medical costs per individual.
