Building Lasting Loyalty: Retaining Medicare Advantage Members

4/2/2025

In today's competitive Medicare Advantage marketplace, member acquisition costs continue to rise while retention remains the true driver of profitability. As most industry professionals are aware, the economic benefits of member retention far outweigh those of acquisition, with retained members typically delivering significantly more lifetime value than new enrollees.

The first 90 days of a new member relationship are especially precarious. Members who make the switch to your plan during the most recent annual enrollment period (AEP) typically represent your highest flight risk segment. These members are essentially "trying you out," having already demonstrated their willingness to change plans once.

New members who have recently switched plans are two to three times more likely to switch again during their first year compared to established members, reports AHIP. This “revolving door” reality underscores how important it is to implement targeted retention strategies that are specifically designed for your newest members.

The high cost of ignored communications

Perhaps the most compelling argument for robust communication strategies can be found in examining what happens when your members don't engage with plan communications. The annual Medicare Shopping and Switching Study from Deft Research reveals a troubling pattern: Members who reported ignoring correspondence from their previous plans were significantly more likely to experience unwelcome surprises, driving them to switch.

In my work with various Medicare Advantage organizations, I have found that a substantial number of plan switchers cite "unexpected changes they weren't informed about" as a primary reason for leaving their previous plan. In reality, however, these plans typically did communicate these changes, but the information failed to break through.

Direct mail’s surprising power 

Direct mail can be a key component of a successful marketing toolkit —and can help ensure your organization’s messages will be successfully received by members.

It may seem counterintuitive in our digital-first world, but direct mail remains one of the most effective channels for Medicare Advantage member communications. Engagement analytics consistently show that Medicare beneficiaries respond favorably to physical mail. More than half – 53% – of direct mail recipients indicated they either reviewed the material or shared it with a broker or family member/friend, according to the 2025 AEP Shopping Experience Survey from Media Logic.

While the target recipients of Medicare marketing plans have generally adapted to the digital world, 71% say that direct mail still feels more personal than electronic communications, according to Deft Research and Media Logic. This type of personalized experience leads to staying power and a reinforcement of the brand.

Building a strategic retention communications framework

Here’s a framework for effective member retention, based on various Deft Research studies and my own communications experience:

• Implement an enhanced onboarding sequence that extends beyond the welcome kit — and include touchpoints at 30, 60, and 90 days
• Prioritize high-risk moments — the first claim, first prescription fill, or primary care provider selection
• Leverage direct mail for critical communications, particularly for benefit changes, formulary updates, and network modifications
• Create differentiated communication streams for new versus tenured members, and be sure to recognize their distinct informational needs
• Employ simple, clear language that emphasizes member benefits — avoid technical insurance terminology

Recognize retention as a strategic imperative

Keep in mind that proactive communication around potential pain points can dramatically improve retention. A proactive approach is particularly important when it comes to plan changes. Members who feel blindsided by network changes, premium increases, or benefit modifications are the most likely to shop for new coverage during the next AEP.

According to a study by Press Ganey, health plans that implement proactive and personalized member-experience strategies can effectively improve member retention. These strategies include:

• Regular communication with members
• Personalized experiences based on member preferences
• Proactive, early intervention to handle potential issues

By being proactive and crafting personalized experiences, health plans can build better relationships with members, leading to improved net promoter scores (NPS) and overall member retention.

As Medicare Advantage competition intensifies, the plans that thrive will be those that recognize retention as a strategic imperative rather than an operational afterthought. By building robust, member-centric communication strategies that recognize the unique vulnerability of new enrollees — and leverage the enduring effectiveness of direct mail — Medicare Advantage organizations can transform retention from a perpetual challenge into a sustainable competitive advantage.

Cindy Thomas is Healthcare Partnerships Strategist with RRD.