Membership Growth

Experts Challenge Specter of ‘Widespread’ ACA Enrollment Fraud

In recent letters to two federal watchdog agencies, Republican leaders of key House committees demand an investigation into “widespread” improper enrollment in Affordable Care Act exchange plans, citing the findings of a paper from Paragon Health Institute, a right-leaning think tank.

Health policy experts who spoke to AIS Health agree that that there are incentives for enrollees — and the brokers who help them find coverage — to estimate their income in such a way that they will qualify for the richest ACA subsidies. However, they aren’t convinced that there’s large-scale enrollment fraud taking place.

In their paper, the Paragon researchers estimate that 4 million to 5 million people are improperly enrolled in $0-premium (or fully subsidized) ACA exchange plans as of 2024, costing taxpayers between $15 billion and $20 billion.

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An Overview of Medicare Part D Enrollment, Costs in 2024

Medicare Advantage Prescription Drug plans (MA-PDs) continued to gain more enrollees than stand-alone Prescription Drug Plans (PDPs) in 2024, according to a KFF analysis.

As of 2024, about 53.1 million Medicare beneficiaries were enrolled in a plan with Part D prescription drug coverage, with 57% in MA-PDs and 43% in stand-alone PDPs. Two-thirds of enrollees receiving the low-income subsidies (LIS) — 9 million out of 13.7 million — chose MA-PDs in 2024. Among the 14 national PDPs, 11 of them lost non-LIS enrollees, with only Wellcare Value Script seeing significant membership growth (from 2.6 million to 3.7 million) due to its low monthly premium.

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Health Care Coverage, Spending Trends Diverge Among Payers as COVID-Related Policies Expire

The share of people without health insurance coverage reached an all-time low of 7.2% in 2023 but is projected to rise to 8.9% in 2034, according to the Congressional Budget Office.

The increase in the uninsured rate was largely due to the end of Medicaid’s continuous eligibility provisions in 2023 and 2024, the expiration of enhanced subsidies available through the Affordable Care Act (ACA) marketplaces after 2025 and a surge in immigration that began in 2022, observed the CBO in a report posted June 18.

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VNS Health Pursues ‘Near Duals’ MA Growth in NYC and Beyond

Medicare Advantage membership growth during both the 2024 Annual Election Period (AEP) and the Open Enrollment Period (OEP) was largely driven by major insurers (namely, CVS Health Corp.’s Aetna) and some of the insurtechs, according to a recent AIS Health analysis. But many of the regional and provider-led insurers that performed well during the AEP also continued their growth through the OEP. One such plan is VNS Health, which has long catered to underserved New Yorkers with complex needs and recently relaunched MA plans designed for Medicare-Medicaid dual eligibles and “near duals.”

As part of an annual series on the growth stories of AEP/OEP “winners,” AIS Health, a division of MMIT, spoke with leaders at VNS Health about their successful reentry into MA.

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Reports Underscore Risk of Failing to Extend Enhanced ACA Subsidies

Recent analyses from the Congressional Budget Office (CBO), Centers for Disease Control and Prevention (CDC), and the Urban Institute all demonstrate the impact that’s been made by the supersizing of Affordable Care Act exchange subsidies — as well as the damage to coverage rates and insurance markets that could be wrought if they aren’t extended past 2025.

The enhanced subsidies have been in place since March 2021 after the passage of the American Rescue Plan Act. They both increased the level of advance premium tax credits available to lower-income individuals (making $0-premium plans widely available to that cohort) and expanded eligibility for APTC to middle-income Americans for the first time.

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What Happens If Enhanced Premium Tax Credits Expire?

If enhanced Affordable Care Act subsidies are extended past 2025, 17.4 million people would receive subsidized coverage next year, compared with 10.2 million if only original advance premium tax credits (APTC) are in place, a recent Urban Institute analysis shows. Meanwhile, four million more uninsured people will be covered in 2025 if the subsidy enhancements are extended.

The enhanced APTCs — which were initially passed as part of the 2021 American Rescue Plan Act and extended as part of the 2022 Inflation Reduction Act — resulted in lower premiums for ACA marketplace enrollees at all income levels and allowed many low-income enrollees to access $0-premium plans. If Congress doesn’t act, the credits will expire at the end of the 2025 plan year.

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ICHRAs: Poised for Major Growth or Overhyped ‘Niche Market’?

During Oscar Health, Inc.’s recent Investor Day presentation, CEO Mark Bertolini declared that “ICHRA’s time has come,” referring to Individual Coverage Health Reimbursement Arrangements, which the insurer said it believes is the key to expanding its presence in the individual insurance market. However, some industry experts and two much larger health insurers aren’t convinced that these alternatives to traditional employer-sponsored plans are poised for their big break.

“They’ve done a really good job getting a lot of attention on something that’s really a non-issue,” Ari Gottlieb, principal of health care consulting firm A2 Strategies, says of Oscar’s ability to generate headlines about the ICHRA’s market potential.

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Insurtech Investor Talks Highlight Promise of MA Despite Headwinds

During presentations at recent investor conferences and meetings, three of the industry’s so-called “insurtechs” expressed a notable degree of confidence in their ability to profit from the Medicare Advantage space, even as their more diversified and established publicly traded peers struggle with increased utilization and diminishing reimbursement. That’s largely because of the investments they’ve made in proprietary technology that is driving care coordination.

In opening remarks at the company’s June 10 annual stockholder meeting, Clover Health Investments, Corp. CEO Andrew Toy touted year-over-year improvement in adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) — the company recorded a profit for the first time — “all in the same year that the greater Medicare Advantage ecosystem took a step back.” Referring to its cloud-based, artificial intelligence-powered clinical support tool Clover Assistant, he told investors, “The fact that our entire clinical management model is driven by technology is something that we believe to be a significant moat for us and something that bodes well for our business as we move into a technology-centric, AI-accelerated world.”

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Aetna, Insurtechs Outpaced Medicare Advantage Peers in Quieter OEP

Medicare Advantage enrollment grew by 350,000 members during the 2024 Open Enrollment Period (OEP), according to CMS’s May data release and AIS’s Directory of Health Plans. That’s a 31% drop from last year, which saw 507,000 sign-ups from February to May, and it reflects a slowdown in MA growth also seen in the Annual Election Period (AEP).

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Fast-Growing NY Insurer Credits MA Benefit Stability, Behavioral Health Focus

CDPHP, a not-for-profit managed care organization serving Medicare Advantage members primarily in Upstate New York and the Hudson Valley, is one of several provider-led insurers that carried a strong growth trajectory from the Medicare Annual Election Period (AEP) through the Open Enrollment Period (OEP) in the first quarter of 2024, according to a recent AIS Health analysis.

The Albany-based insurer added more than 5,000 MA members during the AEP and another 5,400 between February and May, for overall growth of 20% since October, per AIS’s Directory of Health Plans. According to CDPHP’s senior vice president and chief growth officer, Nicholas Kraft, the plan nabbed 66% of new enrollment in its market and is now the third-fastest growing MA plan in the U.S. CDPHP was also ranked No. 1 in member satisfaction among commercial insurers in New York State by J.D. Power & Co.

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© 2024 MMIT