Module 1
How Medicare Advantage Works
MA now covers a majority of Medicare beneficiaries. How plans are paid through benchmarks, bids, and rebates, and how the quality bonus lifts the whole formula.
By the end of this module, you will be able to:
- Describe the scale of Medicare Advantage and what plans are obligated to cover
- Trace how a benchmark, a bid, and a rebate combine into a plan's payment
- Explain how Star Ratings raise both the benchmark and the rebate share
- Medicare Advantage in the Landscape More than half of eligible Medicare beneficiaries are now in private plans. This lesson covers what Medicare Advantage is and why its scale changes everything. About 4 min
- How Plans Get Paid Bids, benchmarks, and rebates: the machinery that determines what a Medicare Advantage plan receives and what enrollees get back. About 5 min
- The Quality Bonus Star Ratings do not just inform consumers, they raise the benchmark itself. This lesson covers the bonus that makes quality worth billions. About 4 min
Module quiz
Answer all questions to see your score.
1. Roughly what share of eligible Medicare beneficiaries is enrolled in Medicare Advantage as of 2026?
MA covers roughly 55 percent of eligible beneficiaries, about just over 35 million people, so for most beneficiaries MA is Medicare.
2. When a plan bids below its benchmark, what happens to the difference?
The rebate is what funds MA supplemental benefits and low premiums, which is the program's core consumer proposition.
3. How does bonus status change a plan's benchmark?
Because the benchmark is the ceiling everything else runs from, lifting it raises payment throughout, and the rebate share rises with stars too.