Medicare Advantage and PDP Plans Continue Robust Growth
The August enrollment numbers are in from CMS. 61,000 new MA members in August and 544,000 year-to-date. MA and PDP plans continued their robust growth on pace to exceed 2010’s enrollment gains. Year to date it appears Boomer “age-ins” are continuing to choose MA at a higher rate than their forebears — more than 40% for the last two years. With major MA/PDP sponsors like Aetna and HealthNet now relieved of marketing and sales sanctions from CMS, MA enrollment growth may exceed 7% for the year.
The story behind the numbers is clear: MA plans are adjusting just fine to the “new normal” post-ACA. Benefit designs have held relatively steady, and plans are making big investments in better revenue management, like mastering risk adjustment and the new Star Ratings bonuses, to offset the ACA’s cuts. Many are revisiting their entire service model in response to Stars, recognizing that keeping members is the new selling.
At the pace we are on, MA will hit 15 million beneficiaries sometime in 2016. But that of course assumes Congress and the debt reduction “supercommittee”:
- don’t require another pound of flesh from the plans in whatever deal they hatch up in November
- get the Medicare physician pay fix enacted permanently. There’s an enormous price tag of over $300 billion over 10 years for this, but without it, MA rates could be cut another 7% in 2013 and beyond. This is the single largest threat facing the program in the next several years.
Let’s hope the noble experiments in creating insurance markets that are MA and Part D are allowed to continue when Congress reconvenes in September.