Although there is no clear prediction for the markets in the coming year, insurance companies are still planning on widening their clientele and trying to increase profits. Not only are they growing in terms of location but also the kinds of health benefits that they will offer to these Medicare users. Continue reading to learn more about what may be included and the opposition they’re facing.
Health insurers are already making moves to expand their Medicare Advantage markets for 2023 despite uncertain financial markets and scrutiny of certain business practices.
These efforts to expand their privatized Medicare plans into new states and counties come despite roiled financial markets that could slow funding for some companies and federal investigations into how these companies calculate risk adjustments and bill for sicker patients.
In the coming weeks, established health insurers including UnitedHealth Group’s UnitedHealthcare, CVS Health’s Aetna, Cigna and Elevance Health, formerly Anthem, are expected to report strong second quarter performance of their Medicare Advantage operations. Meanwhile, startups and smaller regional health plans are using funds from their financial backers and investors to launch expansion into new markets for next year, despite the competitive landscape and volatile financial markets.
Take Alignment Healthcare, which last week said it would enter the fast-growing markets of Florida and Texas. The startup plan, which became publicly traded last year, said it sees in Texas and Florida alone a market of “an additional 1.1 million Medicare-eligible seniors, resulting in total of 8.2 million Medicare-eligible seniors across 52 counties in six states in 2023.”
Across the country, health insurers have escalated expansions into new areas, pushing Medicare Advantage enrollment to record highs. Medicare Advantage plans added more than 2 million beneficiaries for this 2022 coverage year, boosting the program to 45% of all Medicare enrollment, according to a study earlier this year by The Chartis Group.
Medicare Advantage plans contract with the federal government to provide extra benefits and services to seniors, such as disease management and nurse help hotlines with some also offering vision, dental care and wellness programs. And in recent years, the Centers for Medicare & Medicaid Services has allowed Medicare Advantage plans to cover more supplemental benefits, adding to their popularity among seniors.
And while federal regulators and Congress have begun evaluating certain Medicare Advantage business practices, the privatized benefit program for seniors retains support from the Biden administration and bipartisan members of Congress.
As one example, the Centers for Medicare & Medicaid Services in April announced an 8.5% revenue increase for Medicare Advantage plan payments for 2023. Meanwhile, the growth rate was set at 4.88%, which was higher than a proposed rate increase announced earlier this year.