By Jessica Hall
Medicare Advantage brokers raked in $10 billion a year in commissions – but how many people are they helping?
The majority of broker payments come from Medicare Advantage plan renewals, a new study has found.
Your insurance broker is getting a hefty commission to put you – and keep you – in a Medicare Advantage plan.
Insurance brokers reaped $10.1 billion from insurers in 2022, up from $3.9 billion in 2014, for signing up and renewing Medicare Advantage subscribers, according to a new study published in JAMA Internal Medicine. In 2022, 73.6% of broker spending was for renewal enrollments.
“There’s nothing inherently wrong with having brokers. The concern with the current system is that there’s a lot of money spent on broker fees and the incentive is there, but without a requirement to do what’s in the best interest of the beneficiary,” said David Meyers, lead author of the study and associate professor of health policy at Brown University.
The information in the study was obtained through a Freedom of Information Act request and had not been readily available previously, the study said.
“I was shocked at how high the spending amount was and how many renewal commissions were happening,” Meyers told MarketWatch. “The big concern is whether brokers are collecting the renewals and not doing the education part.”
Brokers received a maximum compensation rate of $611 for new enrollees and $306 for renewals, the study said. About 25% of people switch plans every year, but most people make a choice and stick with their plan for a number of years, Meyers said.
Read: Most Medicare Advantage plans are free upfront. You still might not be able to afford one.
“It’s not clear to me the value of the renewal payments,” Meyers said. “It’s not totally clear if the person was meeting with a broker or the broker was submitting for a fee on their behalf. Did the broker just text the beneficiary and say ‘Are you happy with your plan?’ and submit for a renewal fee?”
There were 22 million new enrollments and 112 million renewal enrollments in Medicare Advantage from 2014 to 2022, the study found. The proportion of new Medicare Advantage enrollees who were referred by a broker increased from 35.8% in 2014 to 43.7% in 2022. The proportion of enrollees remaining in their plan who generated a renewal fee increased from 50.1% in 2014 to 69.4% in 2022, according to the study.
Medicare Advantage controls more than half of the overall Medicare market, but its growth is slowing. Medicare Advantage plans had 35.5 million enrollees as of February 2026, up 3.2% from 34.4 million enrollees as of February 2025, according to data from the Centers for Medicare & Medicaid Services. Medicare Advantage represents 51% of the total Medicare market of roughly 69.6 million subscribers.
Read: Here’s what’s really stopping Medicare Advantage from covering all of America’s seniors
While still increasing subscriber numbers, Medicare Advantage has seen its gains cooling. The insurers behind the Medicare Advantage market have been exiting certain unprofitable markets or discontinuing plans amid higher-than-expected medical expenses among subscribers and changes in government payments that have squeezed margins.
The use of brokers has increased over time, and most of this spending goes to brokers who keep members enrolled in the same plan. This increase in renewal fees is the largest driver of the increase in broker spending over time, rather than changes in the fee per enrollment, according to the study.
Medicare Advantage – the private-plan alternative to traditional Medicare – offers extra benefits such as vision and dental coverage and caps annual out-of-pocket costs, but the trade-off is a limited choice of doctors and requirements for specialist referrals.
Read: Are taxpayers wasting billions of dollars on SilverSneakers and Medicare Advantage goodies they don’t use?
Medicare Advantage is also costly for taxpayers: The government paid 22% more per Medicare Advantage enrollee – amounting to about $83 billion a year more than if those people had been enrolled in traditional Medicare, according to a 2024 report by the Medicare Payment Advisory Commission, the independent federal agency that advises Congress.
A broker is not a fiduciary of the beneficiary, meaning they don’t have to act in the enrollee’s best interest. A broker may enroll beneficiaries based not on their needs but rather on which plans compensate them the most through commissions and bonus payments for meeting enrollment targets.
“Part of the area of concern is that [Medicare Advantage] costs the government more. Broker fees are much higher for MA than they are for Medigap and Part D plans. The broker gets paid much more for MA, and there’s an incentive there to steer beneficiaries to MA,” Meyers said.
“It’s probably an underestimate. Brokers receive other bonuses – plans pay brokers extra outside of commissions for meeting certain targets,” Meyers said.
Meyers said he hopes the study brings more attention to the topic of broker fees.
Read: Medicare Advantage buyers, beware: The rules for selling plans are changing – and could harm seniors
More research is needed to determine if these enrollments lead to better outcomes or satisfaction, or if the spending on brokers could instead be directed to state health insurance assistance programs, known as SHIPs, which are free, independent counseling services for Medicare beneficiaries, the study said.
The Better Medicare Alliance, the industry trade group for Medicare Advantage, said health insurance is one of the biggest decisions older adults make, and the choices in the Medicare program keep growing.
“Last year, the average beneficiary had more than 40 Medicare Advantage plans to choose from, on top of Medigap and Part D options. Health coverage is not one-size-fits-all, and licensed agents and brokers play an important role helping seniors understand their options and find coverage that fits – taking into account their doctors, their prescriptions, their budget, and their health needs,” a spokesperson for the trade group said in an emailed statement to MarketWatch.
The group said it has “long supported strong guardrails on how Medicare Advantage is marketed, including expanded oversight of third-party marketing organizations. We look forward to continuing our work with policymakers to strengthen Medicare Advantage for the more than 35 million beneficiaries who choose it.”
Read: Medicare premiums could double over next the decade, wrecking retirement budgets
-Jessica Hall
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05-19-26 1059ET
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