Radar on Medicare Advantage

✦ Despite care utilization patterns rising closer to normal levels in the third quarter of 2020, adjusted earnings per share (EPS) for UnitedHealth Group fell 10% year-over-year to $3.51 as the company undertook “extensive consumer and customer financial assistance measures,” the insurer reported on Oct. 14. Medical loss ratio for the quarter was 81.9%, compared with 82.4% a year ago, driven by “modestly lower care patterns and the return of the health insurance tax,” and offset by COVID-19 assistance measures that included support of state testing and contact tracing efforts. For the quarter ending Sept. 30, the UnitedHealthcare segment recorded $50.4 billion in revenue, compared with $48.1 billion in the third quarter of 2019. That increase was fueled by growth in the firm’s public-sector and senior programs, which served 935,000 additional people year to date, and was partially offset by declining commercial enrollment. As of Sept. 30, UnitedHealthcare served 5.67 million Medicare Advantage lives (up from 5.6 million in the second quarter) and 6.4 million Medicaid enrollees (compared with 6.2 million in the previous quarter). UnitedHealth raised its full-year adjusted EPS outlook to a range of $16.50 to $16.75, from an earlier range of $16.25 to $16.55. Visit www.unitedhealthgroup.com/investors.

✦ Clover Health recently unveiled its intent to go public via a merger with Social Capital Hedosophia Holdings Corp. III, which is a special purpose acquisition company. The transaction, which is expected to close in the first quarter of 2021, values Clover at $3.7 billion and will provide up to $1.2 billion in cash for the newly constituted company. Visit www.cloverhealth.com.

Through its longstanding Medicare Part D partnership with Humana Inc., Walmart has always had its toe in the insurance market. But two moves unveiled this month indicate the retail giant is digging deeper into the health care space: (1) the launch of its own Medicare insurance brokerage, and (2) a new co-branded Medicare Advantage offering with tech-focused insurer Clover Health, which is planning to go public (see brief, p. 8).

For the 2021 plan year, San Francisco-based Clover Health on Oct. 1 introduced two new PPO plans: LiveHealthy: Clover Powered, Walmart Enhanced, and LiveHealthy LI: Clover Powered, Walmart Enhanced. The options will be available to about 500,000 Medicare-eligible beneficiaries in eight Georgia counties. The venture-backed firm in August said it plans to triple its geographic footprint, increasing its MA service area to 108 counties in eight states (RMA 9/3/20, p. 1). Clover currently services 57,000 MA enrollees in 34 counties across seven states.

An earlier version of this story incorrectly stated that Delaware Life Insurance Co. (DLIC) was sitting out the 2021 Medicare Annual Election Period (AEP). AIS Health has since learned that DLIC was released from sanctions before the Oct. 15 start of the AEP.

Just in time for the Medicare Annual Election Period (AEP) that began on Oct. 15, Medicare Advantage and Part D sponsor Delaware Life Insurance Co. (DLIC) was released from sanctions imposed more than eight months ago after its members faced numerous difficulties upon joining the plan. But in a lawsuit filed in the Cook County Circuit Court of Illinois, DLIC affiliate Clear Spring Health is blaming TMG Health and its allegedly faulty technology platform for the onboarding issues that led to marketing and enrollment sanctions.

Major geographic expansions, increased interest in Special Needs Plans (SNPs), and $0 telehealth visits and other benefits aimed at keeping seniors healthy at home are just a few of the 2021 Medicare Advantage trends that can be gleaned from recent press releases and CMS’s so-called landscape files. And while many plans already offered at-home benefits and other extras to address social determinants of health (SDOH), they appear to be emphasizing the usefulness of such tools as the COVID-19 pandemic wears on, especially for dual-eligible enrollees.

Based on an AIS Health review of available press releases, here are some of the noteworthy changes:

For all MA Prescription Drug (MA-PD) plan members, Humana Inc. said its 2021 benefits will include $0 telehealth copays for primary care physician (PCP) visits, urgent care, and outpatient behavioral health, $0 copays for COVID-19 testing, and a Health Essentials Kit featuring “useful items for preventing the spread of COVID-19 and other viruses like the flu.” For MA-PD members with a COVID diagnosis, there is a $0 copay for treatment and 14 days of home-delivered meals (up to 28 meals).

Although more than three-quarters of Medicare Advantage beneficiaries remain in highly rated plans, the percentage of MA Prescription Drug (MA-PD) plan enrollees estimated to be in contracts receiving 4 or more stars in 2021 fell by approximately 4 percentage points from 2020. That overall takeaway from the Oct. 8 release of the 2021 star quality ratings was somewhat surprising, given that there were no new measures for 2021 and CMS used some of the same data to ease reporting burden during the pandemic, but a deeper look at the results reveals several factors at play, industry experts tell AIS Health.

According to the CMS Fact Sheet released alongside the stars data, approximately 49% of MA-PD plans (194 contracts) that will be offered in 2021 earned overall star ratings of 4 or higher, compared with 52% of MA-PDs (210 contracts) offered in 2020. Weighted by enrollment, roughly 77% of MA-PD members are currently in contracts that will have 4 or more stars in 2021, down from about 81% in 2020, estimated CMS. And the average MA-PD star rating weighted by enrollment fell from 4.16 in 2020 to 4.06 for 2021.