Radar on Medicare Advantage

Like the other publicly traded insurers that reported third-quarter 2021 earnings late last month, select Medicare Advantage insurers in early November demonstrated strong performances during a quarter that was tainted by a rise in COVID-related costs. Unlike its more balanced peers, however, MA-focused Humana Inc. took a decidedly conservative approach to projecting earnings for the full year given continued COVID uncertainty.

Of the newly public startup insurers that reported third-quarter 2021 earnings, all four posted higher (worse) medical loss ratios (MLRs) compared with the prior-year quarter — a direct result of higher COVID-related costs. The two insurers with a focus on Medicare Advantage, however, demonstrated wildly different experiences, with Clover Health Investments Corp.’s MLR clocking in at 102.5%, while Alignment Healthcare, Inc.’s 85.7% MLR was more in line with those of the larger, established insurers.

Schenectady, N.Y.-based MVP Health Care has long served Medicare beneficiaries in New York and Vermont with Medicare Advantage and Medicare Savings Account plans. It is also a contractor for the New York State Medicaid program, caters to employers, and offers individual and family plans on and off the Affordable Care Act exchanges. For 2022, the not-for-profit insurer is launching a Dual Eligible Special Needs Plan (D-SNP) through a joint venture with Belong Health, a new company that was co-founded by former Cigna Corp. executive J. Patrick Foley and specializes in helping regional payers launch MA and SNP products.

From 2017 to 2021, the number of people enrolled in Special Needs Plans (SNPs) grew 69.2%, topping 4.1 million lives, according to the latest update to AIS’s Directory of Health Plans. D-SNPs saw the most growth, a whopping 79.3% increase to 3.7 million lives, followed by I-SNPs (+31.9%), then C-SNPs (+16.6%). Meanwhile, plans have grown to meet that surge, with the total number of SNP offerings expanding from 498 to 926 plans in the same time period, per an analysis of CMS’s Landscape files from Clear View Solutions, LLC.

The Biden administration’s first Medicare Advantage and Part D regulation is pending review at the Office of Management and Budget. The CMS final rule, titled “Policy and Technical Changes to the Medicare Advantage Program and Medicare Prescription Drug Benefit Program; MOOP and Cost Sharing Limits (CMS-4190),” was received on Nov. 10. It is not economically significant, according to the posting at RegInfo.gov.