Earlier today I noted that according to the most recent Medicare enrollment report from the Centers for Medicare & Medicaid Services (CMS), Medicare Advantage enrollment--in which a private insurance carrier is paid by the federal government to administer Medicare benefits, and which differs in some important ways from "traditional" or "Fee for Service" Medicare--is on the verge of overtaking traditional Medicare in terms of total enrollment.
As of May 2023, 48.5% of all Medicare enrollees were covered via a Medicare Advantage plan, a percentage which has been steadily increasing over the years (it was only at 35.5% as of 2019).
While I mention this every time I post about the latest Medicare enrollment report, it's been some time since I've checked on the traditional vs. privately administered variants of Medicaid enrollees. For a long time I've been under the impression that roughly 70% of Medicaid enrollment was handled via Managed Care Organizations (MCOs):
Hmmm...this is a bit odd. Every month for years now, the Centers for Medicare & Medicare Services (CMS) has published a monthly press release with a breakout of total Medicare, Medicaid & CHIP enrollment; the most recent one was posted in late February, and ran through November 2022.
Updated 8/17/23: D'oh! I completely forgot about this development when I started running my state-by-state rate filing analyses this summer. No wonder Humana has disappeared from over a dozen states for 2024!
Update 3/15/23: At the request of Humana's Sales Integrity Dept., I've removed their logo from this blog entry.
Before I start, let me say that I've never been a fan of Medicare Advantage, at least as its currently structured, for a number of reasons. I am not advocating for the Medicare Advantage system--again, as currently structured--to be expanded.
In 2019, CMS (2020b) began publishing its Quality Rating System (QRS) for incumbent insurers who sell qualified health plans in the individual market. This information includes scores for medical care, member experience, and plan administration which are then rolled up into an overall, global quality rating (GQR). Recent research has shown notable variation by plan characteristics for behavioral health quality (Abraham, et al., 2021) and plan administration scores (Anderson, et al., 2020). CMS hopes this information is used by consumers to make enrollment decisions.
Believe me, I was certain that I had finally gotten this year's Medical Loss Ratio (MLR) rebate project out of my system. I really was.
However, there was one other MLR-related issue which I've wondered about for years: The ACA requires that carriers who sell policies in the Individual and Small Group markets spend at least 80% of the premium revenue on actual medical claims (limiting them to a 20% gross margin), and 85% on the Large Group market (limiting them to 15% gross).
That accounts for around 165 million people, give or take...roughly 50% of the total U.S. population...but what about the other private (or at least semi-private) insurance markets? I'm referring, of course, to privately-administered Medicare and Medicaid plans...aka Medicare Advantage and Managed Care Organizations (MCOs).