Featured Health Business Daily Story, Jan. 30, 2017

Enrollment Snapshot Suggests Big January Jump in MA Figures (with Table: MA, Cost, PACE, Demo, and Prescription Drug Plan Contract Report)

Reprinted from MEDICARE ADVANTAGE NEWS, biweekly news and business strategies about Medicare Advantage plans, product design, marketing, enrollment, market expansions, CMS audits, and countless federal initiatives in MA and Medicaid managed care. Sign up for an $87 two-month trial subscription today.

By Lauren Flynn Kelly, Managing Editor
January 26, 2017Volume 23Issue 2

Medicare Advantage enrollment as of the Jan. 1, 2017 payment date reached 19.4 million beneficiaries, or 33.9% of total Medicare-eligible individuals, according to CMS data posted Jan. 17. While the January figures typically do not provide a complete picture of what happened during the Annual Election Period (AEP), this year’s data indicate a large pickup of lives from December and may reflect some of the uncertainties faced by seniors around the November 2016 election, experts say.

In a Jan. 17 research note from Barclays Research, securities analyst Joshua Raskin said enrollment seen thus for 2017 is “well above growth rates seen in recent years” and “screens as directionally positive.” Based on the CMS January 2017 MA state/county penetration report — which reflects enrollment through Dec. 9, 2016, two days after the AEP concluded — January MA enrollment was up 785,000 lives from the month prior, compared with nearly 54,000 new enrollees as of the Dec. 1 payment date (MAN 1/12/17, p. 8).

That represents a 4.2% month-to-month increase, whereas over the past four Januarys, growth has averaged 1.4% sequentially, or about 214,000 lives, wrote Raskin. The total MA market is up 8.4% from the prior year, “which is more on par with the 9.2% growth exhibited in 2013 and 9.8% growth in 2014,” he added.

Medicare Advantage News

Enrollment in MA and Prescription Drug Plans combined reached nearly 44.5 million. UnitedHealth Group is “clearly driving a majority of the MA growth,” wrote Raskin, and the January data show all companies, with the exception of Aetna Inc. and Centene Corp., are above Barclays first-quarter 2017 estimates thus far.

UnitedHealth maintained its position as the both the largest MA and PDP plan sponsor, with 4.6 million and 5.4 million members, respectively, observed securities analyst Thomas Carroll in a Jan. 18 research note from Stifel Co. Humana Inc. posted “decent enrollment gains” of 219,000 PDP lives and 69,000 MA lives to reach 3.3 million and 5 million, respectively, while Aetna Inc. — whose planned acquisition of Humana was blocked by a federal district court (see story, p. 1) — on its own made strides during the AEP, adding 14,000 net new members, added Carroll. Cigna Corp, meanwhile, is expecting a decline of 50,000 MA customers in 2017, although it projected it will add 300,000 to 500,000 total medical customers, according to a Jan. 10 filing with the Securities and Exchange Commission. That’s because Cigna was placed on intermediate sanctions last year and was the only insurer suspended from enrollment and marketing during the recent AEP as it works to resolve deficiencies uncovered in a 2015 program audit (MAN 9/15/16, p. 7).

Duals Enrollment Is on the Rise

The recent MA membership growth was driven by gains in HMO (up 166,200 lives), local PPO (up 644,500 lives) and other products, including dual eligibles enrolled in the CMS Financial Alignment Initiative Medicare-Medicaid plans, observed Barclays. Despite some volatility in the second half of 2016, a 4.8% month-to-month rise in duals membership to 393,000 lives “implies run-rate revenue figures that are now material for the government focused names,” wrote Raskin. Overall enrollment in Special Needs Plans, of which 90% is in dual eligible SNPs, dropped slightly from just over 2.3 million enrollees to 2,292,810 members (see table, p. 3).

Meanwhile, provider-sponsored plans saw a dip in enrollment during the AEP, according to an analysis by HealthScape Advisors on the early January enrollment results. Although there were some winners and some losers, these plans experienced about a 1% decrease in the aggregate, capturing a little less than 3 million total enrollees, estimates the consulting firm.

“Environmental factors” such as political uncertainty and beneficiary confusion with the “under 65” annual open enrollment via the Health Insurance Exchange marketplace may have contributed to that drop along with hesitancy among seniors to make a change, suggests Cary Badger, a principal with HealthScape.

“Some professional survey people I’ve spoken with really felt that the election had a dampening effect during open enrollment,” remarks Badger, who most recently led the business and market development of four regional health plans in The Regence Group and was director of marketing and database services at AARP prior to that. “Our insights are that Medicare beneficiaries who might have considered switching to MA [from traditional fee-for-service] tend to ‘hunker down,’ whereas MA members are characterized by their shopping behavior and are not as intimidated by change. And I think the provider-sponsored plans were hit a little harder because they’re typically a little more dependent on fee-for-service conversion.”

View the CMS data at http://tinyurl.com/ooohhbs.

Medicare Advantage, Cost, PACE, Demo, and Prescription Drug Plan Contract Report — Monthly Summary Report (Data as of January 2017)

Current Contract Summary:

Number of Contracts

Drug Plan Enrollment

Special Needs Plan Enrollment

Employer Plan Enrollees

MA-Only Enrollees

Drug Plan Enrollees

Total Enrollees

SNP Enrollees

Non-SNP Enrollees

Employer Plan Enrollees (800 Series Plan)

Non-Employer Plan Enrollees

Total "Prepaid" Contracts1

671

2,309,275

17,133,544

19,442,819

2,292,810

17,150,009

3,807,252

15,635,567

Local CCPs

449

1,172,340

15,082,631

16,794,971

2,029,839

14,765,132

3,643,045

13,151,926

PFFS

6

63,974

127,294

191,268

0

191,268

0

191,268

MSA

3

4,746

0

4,746

0

4,746

43

4,703

Regional PPOs

10

124,451

1,220,824

1,345,275

262,971

1,082,304

7,991

1,337,284

MA Subtotal

468

1,905,511

16,430,749

18,336,260

2,292,810

16,043,450

3,651,079

14,685,181

Medicare-Medicaid Plan

58

0

393,115

393,115

0

393,115

0

393,115

1876 Cost

15

343,788

272,037

615,825

0

615,825

156,173

459,652

1833 Cost (HCPP)

9

59,976

0

59,976

0

59,976

0

59,976

PACE

121

0

37,643

37,643

0

37,643

0

37,643

Other Subtotal

203

403,764

702,795

1,106,559

0

1,106,559

156,173

950,386

Total PDPs

64

0

25,042,034

25,042,034

0

25,042,034

4,515,237

20,526,797

Employer/Union Only Direct Contract PDP

5

0

118,533

118,533

0

118,533

118,533

0

All Other PDP1

59

0

24,923,501

24,923,501

0

24,923,501

4,396,704

20,526,797

TOTAL

735

2,309,275

42,175,578

44,484,853

2,292,810

42,192,043

8,322,489

36,162,364

CCPs=Coordinated Care Plans; PFFS=Private Fee-for-Service; MSA=Medical Savings Account; PACE=Program of All-Inclusive Care for the Elderly.

1Totals include beneficiaries enrolled in employer/union only group plans (contracts with “800 series” plan IDs). Where a beneficiary is enrolled in both an 1876 cost or PFFS plan and a PDP plan, both enrollments are reflected in these counts.

Note: Totals reflect enrollment as of the Jan. 1, 2017 payment. The January payment reflects enrollments accepted through Dec. 9, 2016.

SOURCE: CMS monthly enrollment summary report, released Jan. 17, 2017.


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