PROVIDENCE, R.I. [Brown University] — New research offers one of the clearest pictures yet on just how large the Medicare Advantage insurance broker market has become.
Published as a research letter in JAMA Internal Medicine, the study from health policy scholars at the Brown University School of Public Health found that payments to Medicare Advantage brokers more than doubled between 2014 and 2022, rising from about $3.9 billion to roughly $10 billion a year.
Led by health economist David Meyers, the team said the work represents the first national quantitative analysis of how often brokers are used and how much private insurers spend on their commissions.
"At the end of the day, this is money that is coming from the U.S. taxpayer," said Meyers, an associate professor of health services, policy and practice at Brown. "While insurance companies are spending a ton of money on brokers, we don't know if it's actually in the beneficiary's best interest, since brokers are beholden to the companies. This study doesn't answer every question, but it's a first step in better understanding the role brokers are playing, how many people are being enrolled through brokers and how much money is flowing into this market."
In the U.S., millions of older Americans use brokers to help them choose Medicare Advantage plans, which are offered by private insurance companies as alternatives to traditional Medicare. Brokers compare options, explain benefits and enroll seniors in coverage. They are paid commissions by the insurance companies.
The analysis conducted by the research team at Brown's Center for Advancing Health Policy through Research offers a rare behind-the-scenes look at this market, drawing on data obtained through a Freedom of Information Act request.
The study found that broker involvement is both common and growing. In 2014, 36% of first-time Medicare Advantage enrollees used a broker, a figure that rose to 44% by 2022.
One of the most surprising findings, according to Meyers, is that renewals rather than new enrollments were the primary driver of broker spending. Brokers receive an initial commission upon enrollment and additional annual payments for as long as a beneficiary remains in the plan. By 2022, 70% of Medicare Advantage beneficiaries generated a renewal, accounting for 74% of all broker commissions.
"A lot of brokers are getting paid not for helping a beneficiary make an active choice of what plan to enroll in, but just collecting on that choice after the fact," Meyers said. "We didn't expect that number to be so high, and it's been increasing pretty dramatically over the time period we can observe."
The findings add to growing questions about incentives in the broker market, including the possibility that brokers could steer people toward plans offering higher commissions rather than plans that best meet their health needs, Meyers said.
The researchers cautioned that the data does not show the exact amounts each plan paid to brokers. As a result, the $10 billion estimate could be an overestimate if some plans paid less than the federal maximum commission. At the same time, the total may be an undercount because the data doesn't include potentially large bonus payments tied to enrollment targets.
Medicare Advantage plans now cover more than half of all Medicare beneficiaries in the U.S. The Centers for Medicare and Medicaid Services recently attempted to impose guardrails on broker compensation, but the rule was struck down in a federal court in 2024.
The researchers say more evidence is needed to determine whether broker-assisted enrollments lead to better outcomes or satisfaction for beneficiaries.
"We're spending so much money on this, and it's really not clear what we're buying," Meyers said. "We need to pay more attention to what's happening here."
