Health Plan Weekly

At least 13.3 million people lost their Medicaid or Children’s Health Insurance Program (CHIP) coverage and another 24.9 million had their coverage renewed as of December 2023, according to the KFF Medicaid enrollment and unwinding tracker. Starting April 1, 2023, states were permitted to resume disenrolling people from Medicaid who were no longer eligible or failed to complete the redetermination process after a multiyear pause during the COVID-19 public health emergency.

The disenrollment rate so far has ranged from 62% in Texas to 10% in Maine. Overall, 71% of coverage losses were due to procedural reasons, when individuals didn’t complete their renewal process within a specific time frame or the state was unable to reach them. Over 90% of disenrolled people had their Medicaid coverage terminated for procedural reasons in New Mexico (95%), Utah (94%) and Nevada (91%).

Elevance Health, Inc. has agreed to acquire Paragon Healthcare, a company that provides infusion services to patients. Elevance announced the pending transaction on Jan. 4 and said it expects the deal to close in the first half of this year. The companies did not disclose financial details, but Axios reported Elevance will pay more than $1 billion for Paragon, which operates in Alabama, Colorado, Florida, Georgia, Missouri, Oklahoma, Tennessee and Texas. If the deal closes, Paragon will become part of CarelonRx, Elevance’s pharmacy services segment. 

The Cigna Group is in “advanced talks” to sell its Medicare Advantage business to Health Care Service Corp. (HCSC) for between $3 billion and $4 billion, according to a Jan. 3 Wall Street Journal article. The report comes shortly after Bloomberg cited anonymous sources saying HCSC and Elevance Health were interested in acquiring Cigna’s Medicare business, a segment the company entered in 2012 through its acquisition of HealthSpring. Cigna has struggled to compete in Medicare with market leaders such as UnitedHealth Group and Humana Inc., and it has just 580,000 MA lives, according to AIS’s Directory of Health Plans. Earlier last month, the WSJ reported that discussions about a potential transaction between Cigna and Humana had fizzled.  

While deal talks between The Cigna Group and Humana Inc. have reportedly fizzled, Cigna’s desire to sell its Medicare Advantage business is apparently still alive and well. Health Care Service Corp. and Elevance Health, Inc., are the two contenders for Cigna’s MA segment, which could fetch more than $3 billion, according to a report from Bloomberg, citing anonymous sources.  

Industry observers say they aren’t surprised that Cigna is still trying to offload its MA book of business, even if doing so is no longer necessary to fend off antitrust scrutiny associated with a Cigna-Humana megamerger. What’s less clear, they say, is what Cigna’s growth strategy would then look like. 

The Lower Costs, More Transparency Act (H.R. 5378), which the U.S. House of Representatives passed on Dec. 11, contains several provisions that would impact health insurance companies such as the requirement that negotiated rates between payers and providers become public. Meanwhile, U.S. Sen. Mike Braun (R-Ind.) has proposed similar legislation that would amend the Public Health Service Act and provide for more health care price transparency.  

Taken together with the implementation two years ago of transparency regulations for hospitals and insurers, the bills indicate “there’s a broad recognition that we’ve already moved forward in starting to make this data public, so let’s just improve that in a way that works,” according to Dania Palanker, assistant research professor at Georgetown University’s Center on Health Insurance Reforms.