A Nearer Take a look at the 5 Largest Publicly Traded Firms Working Medicaid Managed Care Plans
Whole Medicaid and CHIP enrollment is now over 90 million. The most recent nationwide Medicaid managed care enrollment information (from 2020) present 72% of Medicaid beneficiaries were enrolled in complete managed care organizations (MCOs). In FY 2021, funds to complete Medicaid MCOs accounted for 52% of total Medicaid spending (or greater than $376 billion). Medicaid is a significant supply of revenue and profits for multi-state insurance coverage corporations. KFF evaluation of National Association of Insurance Commissioners (NAIC) information present gross margins per enrollee within the Medicaid managed care market had been greater in 2021 than they had been pre-pandemic. Medicaid MCOs have performed a key function in responding to the COVID-19 pandemic and are anticipated to work with states in conducting outreach and providing support to enrollees through the “unwinding” of the continual enrollment requirement. Starting April 1, 2023, states had been in a position to restart disenrollments (which had been paused since February 2020) after conducting a full review of eligibility. Many individuals will doubtless be discovered to be not eligible for Medicaid, whereas others might face administrative boundaries and lose coverage despite remaining eligible. Medicaid MCOs have a monetary curiosity in sustaining enrollment, which might additionally stop disruptions in take care of enrollees. This temporary takes a better have a look at the 5 largest publicly traded corporations (additionally known as “guardian” companies) working Medicaid MCOs which account for half of Medicaid MCO enrollment nationally. Data and information reported on this temporary come from quarterly firm earnings reviews, monetary filings, and different firm supplies in addition to from nationwide administrative information.
Medicaid enrollment within the 5 largest publicly traded corporations working Medicaid MCOs
5 for-profit, publicly traded corporations – Centene, Elevance (previously Anthem), UnitedHealth Group, Molina, and CVS Well being – account for 50% of Medicaid MCO enrollment nationally (Determine 1). All 5 are ranked within the Fortune 500, and 4 are ranked within the prime 100, with complete revenues that ranged from $32 billion (Molina) to $324 billion (UnitedHealth Group) for 2022. Every firm operates Medicaid MCOs in 12 or extra states (Determine 2). All 5 companies additionally function within the business and Medicare markets (Determine 3); nevertheless, the distribution of membership throughout markets varies throughout companies. Two companies – Molina and Centene– have traditionally targeted predominantly on the Medicaid market. Medicaid members accounted for over 90% of Molina’s general medical membership and almost 70% of Centene’s medical membership as of March 2023 (Determine 3).
Mixed Medicaid enrollment throughout the 5 companies elevated by 13.5 million or 44.1% from March 2020 to March 2023 (Determine 4). Medicaid enrollment general grew by more than 20 million (or about 31%) through the steady enrollment interval (February 2020 to January 2023), leading to progress in MCO enrollment as properly. Enrollment progress has been primarily attributed to the Households First Coronavirus Response Act (FFCRA) provision that required states to ensure continuous enrollment for Medicaid enrollees in trade for a brief improve within the Medicaid match fee. Development in guardian agency Medicaid enrollment might also mirror different exercise together with agency acquisitions and/or new contracts. For the companies that report this data, Medicaid income progress 2022 over 2021 ranged from 11% (Hundreds) to 18% (UnitedHealth) to 21% (Molina). These similar companies reported Medicaid income progress starting from 13% (Hundreds) to 16% (UnitedHealth) to 43% (Molina) year-over-year 2021 over 2020. Molina reported the medical margin earned by the Medicaid phase was $3.0 billion in 2022 and $2.3 billion in 2021 (medical margin = premium income – medical prices).
Implications of “unwinding” for the 5 largest publicly traded corporations working Medicaid MCOs
All 5 companies anticipate Medicaid enrollment losses following the tip of the continual enrollment requirement (over 2023 and 2024); nevertheless, companies anticipate to retain some members who lose Medicaid protection of their Market and different merchandise (Appendix Table). The Consolidated Appropriations Act, 2023 ended the continual enrollment provision and allowed states to renew disenrollments beginning April 1, 2023. Whereas the variety of Medicaid enrollees who may be disenrolled through the unwinding interval is extremely unsure, it’s estimated that tens of millions will lose protection. KFF estimates 17 million people might lose Medicaid protection – together with some who’re not eligible and others who’re nonetheless eligible however face administrative boundaries to renewal. Charges of Medicaid protection loss will differ throughout states relying on how states approach unwinding. CMS has issued particular guidance permitting states to permit MCOs to replace enrollee contact data and conduct outreach in regards to the eligibility renewal course of to facilitate continued enrollment in addition to Market transitions, the place applicable. In June 2023, CMS launched new guidance highlighting a number of new methods accessible to states to stop procedural terminations together with allowing managed care plans to help enrollees in finishing sure elements of renewal varieties.
In first quarter 2023 investor earnings calls, executives of the publicly traded corporations working Medicaid MCOs expressed the intention of maximizing continuity of protection for members by way of supporting continued enrollment in Medicaid and transitions to the Market (and different merchandise), the place applicable. The companies report conducting direct and oblique outreach, together with textual content messages, stay calls, and community-based supplier campaigns, to coach members about Medicaid redeterminations and the renewal course of in addition to about their Market choices if they’re not eligible for Medicaid (Appendix Table).
All 5 companies provide a Certified Well being Plan (QHP) within the ACA market in lots of states the place they function a Medicaid MCO, nevertheless there might not be plan alignment if plans function regionally. Present enrollees who’re decided to not be eligible for Medicaid could also be eligible for ACA market (which has greater revenue eligibility thresholds than Medicaid) or different protection (e.g., CHIP coverage or employer sponsored insurance coverage (ESI)). People eligible for protection within the Market might qualify for plans with zero premiums; nevertheless, people transitioning to Market protection might face greater cost-sharing and completely different supplier networks. Prior analyses suggest that people face boundaries transferring from Medicaid to different protection packages and plenty of might expertise gaps in coverage. CMS guidance outlines states might encourage MCOs that additionally provide a QHP to share data with their very own enrollees who’ve been decided ineligible for Medicaid to help within the switch of people to Market protection (so long as state-specific legal guidelines and/or contract necessities don’t prohibit this exercise). To keep away from gaps in protection, managed care plans might attain out to people earlier than they lose protection to permit them to use for Market protection upfront.
Medicaid managed care plans have a monetary curiosity in sustaining enrollment, which might additionally stop disruptions in take care of enrollees. The 5 publicly traded companies which can be the topic of this evaluation account for half of all Medicaid MCO enrollment nationally. As states unwind the continual enrollment provision, many individuals will doubtless be discovered to be not eligible for Medicaid. Others might face administrative boundaries and lose protection regardless of remaining eligible. Medicaid managed care plans can help state Medicaid businesses in speaking with enrollees, conducting outreach and help, and in the end, in bettering protection retention – together with facilitating transitions to the Market.
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