20 years. Two full decades. That’s how long Americans have been able to utilize what’s known today as the Medicare Annual Enrollment Period, or AEP for short.
Did you know this opportunity to make coverage changes looks vastly different than when it first began? If you’re like Cal and Craig Ritter, Ritter Insurance Marketing’s founder and CEO, then you not only know this, but you’ve lived through and adapted to the adjustments!
We always say the “insurance industry is anything but static.” One can even widen the scope. Technological advancements and societal shifts have not only driven changes in our market, but the way of the whole world!
Silence your smart watch, and join us in taking a brief look at Medicare history, particularly where the market stood 20 years ago, compared to where it stands now!
What Was Happening in the World in 2005?
Before diving into where the Medicare market was back then, let’s set the stage…
In 2005, internet was slow-ly speeding up. Chad Hurley, Steve Chen, and Jawed Karim just gave us YouTube. (Who could predict how many hours we’d spend on that?) Star Wars fans were excited but sad for Revenge of the Sith, what we thought was the final installment of the series… which happens to still be thriving on Disney+ today.
Speaking of streaming, do you remember Netflix back in 2005? It was DVDs you received and returned via good old snail mail! You had to watch TV live or through your DVR, if you had one.
In 2005, Netflix was still DVDs you received and returned via good old snail mail!
2005 brought us the long-running TV shows, The Office and Supernatural. American Idol was extremely popular on Tuesday evenings, and you were pretty happy if you were cheering on either Bo Bice or Carrie Underwood. (One of them now has eight Grammy Awards!) Maybe you were listening to “Boulevard of Broken Dreams,” by Green Day, on your iPod Shuffle or your kids were making their own music in a popular new video game — Guitar Hero, anyone?
Sports fans, these next facts are for you… In 2005, the Chicago White Sox won the World Series and the New England Patriots won Super Bowl XXXIX (their third title in four years). Roger Federer and Justine Henin-Hardenne won their US Open Tennis championships, and Michael Campbell won the US Open for golf!
What Was Happening with Medicare in 2005?
Alright, what was going on in our industry? 2005 was a momentous year for the Medicare program. On January 28, 2005, the Centers for Medicare & Medicaid Services (CMS) published a final rule that established and regulated the Medicare Advantage (MA) and Part D program.
The very first Medicare Annual Enrollment Period started on November 15, 2005.
Later that year, the very first Medicare AEP started on November 15, 2005. It ran through May 15, 2006, officially making AEP history! 2005 was the last year that Medicare beneficiaries could change Medicare plans monthly, which had been permitted every prior year.
If you’re wondering the history of Medicare Advantage or how long have Medicare Advantage plans been around, here’s a summary of the legislation that led to the Medicare program’s establishment:
- The Social Security Amendments of 1965 created Medicare.
- The Social Security Amendments of 1972 first permitted Medicare to contract with HMOs.
- The Balanced Budget Act of 1997 created the Medicare Part C, Medicare + Choice, program and preferred provider organization, private fee-for-services, and medical savings account (MSA) plans.
- The Medicare Modernization Act of 2003 established Medicare Part D, regional PPOs, and Special Needs Plans and renamed the Medicare + Choice program to Medicare Advantage (Part C).
Did you know… Mark McClellan was CMS administrator in 2005 and George W. Bush was President of the United States!
CMS changed the Medicare AEP to span from October 15 through December 7 in 2011.
Medicare Part D Begins!
In 2005, Medicare generally only covered drugs administered in a hospital or doctor’s office (Medicare Part A and B). It did not cover outpatient prescriptions — drugs beneficiaries bought at pharmacies and self-administered. President George W. Bush’s signing of the Medicare Modernization Act (MMA) in 2003 established the voluntary program known as Medicare Part D for 2006. Much like today’s beneficiaries, this gave Medicare eligibles an option for outpatient drug coverage outside of Medicaid or group health insurance.
Regional PPOs & Special Needs Plans Enter the Market
The MMA also authorized regional PPOs and Special Needs Plans (SNPs). These plans were introduced to beneficiaries as options for the 2006 plan year.
Medicare Supplement Plans K & L Introduced
Two additional Medicare Supplements (Med Supps), Plans K and L, were coming onto the market for 2006, also thanks to the MMA. Their out-of-pocket (OOP) limits were $4,000 and $2,000, respectively, nearly 81 percent lower than their OOP limits today.
Med Supp Plans K and L OOP Limits, 2006 vs. 2025
| Med Supp | 2006 OOP Limit | 2025 OOP Limit | % Change |
| K | $4,000 | $7,220 | 80.5% |
| L | $2,000 | $3,610 | 80.5% |
Source: https://www.cms.gov/medicare/health-drug-plans/medigap/k-l-out-of-pocket-limits-announcements
Med Supp Plans K and L were coming onto the market for 2006.
Med Supps H, I, & J Fall
Med Supp Plans H, I, and J all offered prescription drug coverage, but these benefits were dissolved for new Medicare eligibles upon the start of Medicare Part D in 2006. Today, Med Supp Plans C, E, F, H, I, and J are all no longer available for those newly eligible for Medicare.
Medicare Cost History, Then & Now
We don’t think it’s any surprise that Medicare cost less in 2005 than it costs today. If you’re interested, here’s what Medicare premiums and deductibles were 20 years ago, compared to what they are today!
Medicare Part A Costs 2005 vs. 2025
Two decades ago, the monthly Part A premiums for those who had less than 40 quarters of Medicare-covered employment were $375 and $206. Beneficiaries qualified premium-free or reduced-premium Part A based on the same guidelines used today.
Medicare Part A premiums have increased by 38 percent.
Medicare Part A premiums have increased by $143, or 38 percent, since 2005. Part A cost-sharing fees, including the deductible and coinsurances, are now 84 percent higher.
2005 & 2025 Part A Premium, Deductible, & Coinsurance Amounts
| Type of Cost | 20051 | 20252 | % Change |
| Monthly Premium3 | $375 | $518 | 38.13% |
| Reduced Monthly Premium4 | $206 | $285 | 38.35% |
| Inpatient Hospital Annual Deductible | $912 | $1,676 | 83.77% |
| Daily Coinsurance for Days 61 to 90 | $228 | $419 | 83.77% |
| Daily Coinsurance for Lifetime Reserve Days | $456 | $838 | 83.77% |
| Skilled Nursing Facility Coinsurance | $114 | $209.50 | 83.77% |
1Source: https://www.cms.gov/Regulations-and-Guidance/Guidance/Transmittals/downloads/R31GI.pdf
2Source: https://www.cms.gov/newsroom/fact-sheets/2025-medicare-parts-b-premiums-and-deductibles
3For those with fewer than 30 quarters of Medicare-covered employment
4For those with 30 to 39 quarters of Medicare-covered employment
Medicare Part B Costs 2005 vs. 2025
Brace yourself… The Part B deductible and premium are both over 130 percent more expensive nowadays! In 2005, the Part B deductible was $110, and the premium was $78.20. Today, the deductible is $257, and the Part B premium is $185.
The Part B deductible and premium are both over 130 percent more expensive nowadays.
2005 & 2025 Part B Deductible & Premium Amounts
| Type of Cost | 20051 | 20252 | % Change |
| Annual Deductible | $110 | $257 | 133.64% |
| Monthly Premium | 78.20 | 185 | 136.57% |
1Source: https://www.cms.gov/Regulations-and-Guidance/Guidance/Transmittals/downloads/R31GI.pdf
2Source: https://www.cms.gov/newsroom/fact-sheets/2025-medicare-parts-b-premiums-and-deductibles
Currently, beneficiaries with higher incomes have to pay more for their doctor insurance, but everyone paid the same Part B premium in 2005.
Part B Income-Related Monthly Adjustment Amounts (IRMAA) were not published in the federal register until October 27, 2006. IRMAA premiums officially started in 2007.
The Part B-ID (Immunosuppressive Drug) benefit only began in 2023.
Medicare Part D Costs 2006 vs. 2025
You already know that Part D prices have increased, especially between 2024 and 2025 with Inflation Reduction Act of 2022 (IRA) changes taking effect. Did you know that the Part D deductible, set by CMS, has increased by $340, or 136 percent since 2006?
Today, beneficiaries pay roughly 94 percent more for Part D plan premiums than they did when Part D coverage first began.
Monthly premiums were set by insurers back then and still are. Today, beneficiaries pay roughly $23, or almost 94 percent, more for Part D plan premiums than they did when Part D coverage first began.
2006 & 2025 Part D Deductible & Average Premium Amounts
| Type of Cost | 20061 | 20252 | % Change |
| Annual Deductible | $250 | $590 | 136% |
| Monthly Premium | <$24 | ~$46.50 | ~93.75% |
1Source: https://www.cms.gov/Medicare/Prescription-Drug-Coverage/PrescriptionDrugCovContra/Downloads/MemoTransitionDemo_060806.pdf
2Source: https://www.cms.gov/newsroom/press-releases/medicare-advantage-and-medicare-prescription-drug-programs-remain-stable-cms-implements-improvements
Medicare Enrollment & Plan Availability Growth 2005 – 2025
2005-06 was several years before the first, of an entire wave, of Baby Boomers aged into the Medicare program, as well as an entire international health pandemic. We’ve definitely seen growth and change in the number of Medicare plans and enrollees over the years! Here are the stats to prove it.
Medicare Enrollment History, Then vs. Now
In 2005, approximately 42.1 million people were enrolled in Medicare, with 35.6 million of those qualifying from aging in.
Currently, 62.8 million people have Medicare Parts A and B. Around 10,000 people become eligible for Medicare due to their age each day!
MA Plan Availability & Enrollment Increases
54 percent of Medicare beneficiaries currently have an MA plan. The number of Medicare beneficiaries enrolled in MA plans has grown 41 percent since 2005, when only 13 percent of beneficiaries were enrolled in these plans!
The number of Medicare beneficiaries choosing Medicare Advantage plans has grown 41 percent since 2005.
HMOs vs. PPOs
Overall, market share is now more balanced between HMOs and local PPOs, but exact plan availability still varies by location.
The Henry J. Kaiser Family Foundation reported HMO MA plans represented a whopping 95 percent of the market in 2005. PPOs represented one percent of the market, with PPO Demonstration Plans representing two percent. In their 2025 MA Spotlight, KFF (same organization, updated name) reported HMOs currently represent 56 percent of all MA plans on the market. Local PPOs account for 43 percent of the market and regional PPOs account for one percent.
The Henry J. Kaiser Family Foundation reported HMO MA plans represented a whopping 95 percent of the market in 2005!
Looking back, there were 179 total MA plans offered in 2005. The average Medicare beneficiary could choose from 42 total MA plans in 2025, including:
- 2,066 HMO plans
- 1,588 local PPO plans
- 43 regional PPO plans
$0-Premium Plans
Jumping to 2006, the first year of Part D coverage, nearly 70 percent of beneficiaries had access to $0-premium Medicare Advantage Part D (MAPD) plans. In 2025, 99 percent of Medicare beneficiaries have access to at least one $0-premium MAPD!
SNPs
Back in 2006, there were approximately 275 SNPs, 226 D-SNPs and 13 C-SNPs. For 2025, there were 1,445 SNPs offered nationwide, including 909 Dual Eligible Special Needs Plans (D-SNPs) and 376 Chronic Condition Special Needs Plans (C-SNPs).
D-SNP and C-SNP enrollment are both more than five times higher now than in 2010!
Part D Changes & Challenges
The Part D market started with 1,429 stand-alone prescription drug plans (PDPs) and 48 sponsors in 2006. KFF reports there are only seven sponsors and 464 PDPs available in 2025, which is the lowest number of Part D sponsors and PDPs ever available.
As prescription drug changes in the IRA started taking effect in 2025, including the $2,000 OOP limit, more pressure has been put on stand-alone Part D sponsors and PDP premiums.
The Technological Advancements We’ve Made Together
Smart watches didn’t exist in 2005. Neither did a lot of the technology and programs we use in the Medicare industry today! Do you remember…
The Rise of Quote Engines
In 2005, many agents were left to their own devices and calculations for client plan quotes. If you were on the cutting-edge, you might have built an Excel document with formulas you could turn to, but you didn’t have the quick-click quote engines and real-time data feeds that exist today.
Now, there are numerous agent and consumer-facing quote engines available online, whether you’re on your desktop, laptop, smart phone, or tablet! Ritter offers free access to state-of-the-art agent and consumer-facing Medicare quote tools. Register with us for free to check them out
Fax Getting the Ax
Fax isn’t dead yet, but we wouldn’t say it’s the go-to submission method for Medicare applications anymore. Nowadays, agents can scan, upload, and submit a document digitally or top agents help their clients complete Medicare insurance applications 100 percent online.
We can save paper, trees, ink, gas, wear and tear on our vehicles, and precious time and effort while reducing the risk of Medicare application mistakes and delays! In the days of disruption, streamlining sales can go a long way toward helping more clients who need assistance.
Rolodexes Turning into CRMs
Were you using a rolodex, or paper files, in 2005? Hopefully you’ve since upgraded to a customer relationship manager (CRM).
Digital files have their perks! Not only are the files backed up to an online server, so they can be a lot harder to lose, but they can be easy to search and update anywhere you go!
Some CRMs, like Integrity’s, allow you to ask your clients to update their own records! Even better, you can also run quotes based on the information in a client’s profile or automate outreaches!
We didn’t even begin to touch on all of the changes that have occurred these past two decades, but we thought it would be interesting to reflect on where things were in the Medicare industry 20 years ago and where they’re at today. Thanks for reminiscing with us! (You can turn your smart watch volume back up now.)
Here at Ritter, we’re thankful for 20 AEPs and the agents, partners, and staff we’ve worked with throughout them all. Ritter Insurance Marketing was founded in 2005, and today, we’re still here, stronger than ever. Whether you’ve been with us for one AEP or the next one is your first, we look forward to more growth together!
If you haven’t already, register with our site today to check out all our free sales technology and upcoming training events.
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