Health Plan Weekly

If the market reactions to a Humana Inc. regulatory filing and to UnitedHealth Group’s latest earnings report are any indication, concerns about elevated care utilization that cropped up in the second half of 2023 have followed health insurers into the new year.  

While Humana had already expected that heightened medical care use among its senior enrollees would continue through the rest of 2023, “actual fourth quarter results reflect an additional increase in Medicare Advantage medical cost trends,” the company said in a Jan. 18 filing with the Securities and Exchange Commission.  

A bipartisan group of senators has introduced price transparency legislation crafted by the Committee on Health, Education, Labor and Pensions (HELP) that would require plans and providers to publish all of their negotiated rates, codify the Transparency in Coverage (TiC) rule, make data-sharing rules more specific and stringent, and increase fines for noncompliance with data sharing requirements. However, the legislation does not include any site neutrality requirements, although one D.C. insider says that policy is still under discussion in the Senate. 

The Senate bill, S-3548, comes on the heels of the House of Representatives passing the Lower Costs, More Transparency Act in December. The House bill would also codify the TiC rule, make data-sharing requirements stricter and increase fines for noncompliance to as much as $10 million. However, unlike the Senate bill, the House bill would include a tentative step toward site neutrality by barring providers from charging facility fees to Medicare for provider-administered drugs given to patients in outpatient departments. The new Senate bill also does not include any PBM reforms — the Senate Finance Committee has taken the lead on that issue. 

Although 2024 seems far removed from the height of the COVID-19 pandemic, the ripple effects associated with that disruptive global crisis are still influencing how this year will turn out for the U.S. health insurance sector, two top credit ratings firms predict.  

“We’re calling it the pandemic hangover,” says Brad Ellis, senior director in Fitch Ratings' North American insurance rating group.  

“I think this year might be the last year we’re seeing what we call pandemic-related effects on the industry,” adds James Sung, director of insurance ratings at S&P Global. 

Three startup “insurtechs” — Oscar Health Inc., Clover Health Investments Corp. and Alignment Healthcare Inc. — presented at the J.P. Morgan Health Care Conference in San Francisco last week, where they reiterated earlier projections that they expect to close 2024 in the black. Oscar and Clover expect to turn a profit in 2024, while Alignment says it will break even. 

Oscar reiterated its promise to be profitable in 2024, and it teased entry into the Individual Coverage Health Reimbursement Arrangement (ICHRA) market. ICHRAs, which allow participating employers to reimburse employees for Affordable Care Act marketplace coverage at a fixed rate in lieu of purchasing a traditional group health plan, have also been identified as a target market by Centene Corp. in recent weeks.