The golden age of Medicare is over . Humana stock plunging.

[DonP]

Well, add on Aetna to the trifecta of companies warning about MAPD.
You're looking at the MAPD peak. Seems all those wonderful freebies will be reduced.

https://www.modernhealthcare.com/insurance/cvs-health-medicare-advantage-utilization-2024

CVS Health has downgraded its 2024 earnings guidance as its Aetna health insurance subsidiary contends with higher-than-expected Medicare Advantage costs and a looming federal rate cut, the company announced Wednesday.

Aetna's Medicare Advantage business failed to achieve its margin target in 2023, according to CVS Health's fourth-quarter and full-year earnings report. The company will respond by raising premiums and deemphasizing strategies to gain market share, executives said during a call with investor analysts Wednesday.
-----------------

Medicare Advantage claims for outpatient hip and knee procedures, supplemental services such as dental and vision care, and respiratory syncytial virus vaccinations drove higher-than-projected medical spending, CVS Health reported. Aetna's medical loss ratio increased 2.7 % to 88.5% for the fourth quarter and 2.4 % to 86.2% for the full year.
------------
Aetna now joins other leading Medicare Advantage carriers such as UnitedHealth Group, Humana and Centene in warning investors that the segment is under stress. In addition to accelerated medical spending, especially during the fourth quarter, the sector faces a modest reduction in Medicare Advantage benchmark rates next year under a proposed rule the Centers for Medicare and Medicaid Services published last week.

"It's in line with our expectations," CVS Health President and CEO Karen Lynch said. "However, we do not believe it covers overall cost trends that have been emerging in Medicare Advantage."

Insurers also are feeling the cumulative effects of other recent CMS policies such as modifications to the Star Ratings quality program and the risk-adjustment methodology and are cautioning policymakers and consumers that they will react to by taking steps such as raising premiums and scaling back supplemental benefits

Aetna's going to get crushed in 2024 profit wise.They ramped benefits huge and will have to take them back in 2025. Thats why I haven't chased bebefits.They're a good $1000 above all other dnsps on dental and covering implants at 100%. Their food card is 20-25% above other CO's . $600-$1200 for golf fees . Giving ssbci $25-$50 a month food cards on most plans . I'm curious what they mean by "raising premiums". Humana said the same thing . Most of these plans have zero premiums . Wonder if they start charging premiums. Like i said the increased claims isn't just mapd. Med sups will also have these increased claims and will have stiff rate increases . Throw in 50-100% pdp increases in 2025 and shits hitting the fan everywhere .

 

[Duaine]

Cigna's Medicare sale is an uphill battle for HCSC: Moody's

It's going to be a difficult task for Health Care Service Corp. to turn Cigna's Medicare business into a financially successful endeavor, according to a Moody's analysis shared with Becker's.

"We estimate that Cigna's MA business has struggled to be profitable in recent years," the analysts wrote Feb. 5. "Therefore, it will take effort, time and resources to sustainably improve performance."

Cigna reached a deal in January to sell its Medicare business to HCSC for $3.3 billion, which is expected to close in early 2025. The sale includes Cigna's Medicare Advantage, supplemental benefits, Medicare Part D offerings, and CareAllies, a value-based care management subsidiary. The deal will free up $400 million in financial reserves for Cigna, making the total value of the deal $3.7 billion.

The sale is a credit positive for Cigna because its Medicare business has underperformed in recent years, according to Moody's. While the sale proceeds are likely to be used for share repurchases, they will also be used to reinvest in the company's health services business, Evernorth, and other insurance segments.

The acquisition is a credit negative for HCSC because of the large risks involved with integration, which the company has limited experience with. Despite those concerns, the acquisition may prove positive in the long term because of the large boost HCSC will see in Medicare Advantage membership, according to Moody's.

[EXTERNAL LINK] - Cigna's Medicare sale is an uphill battle for HCSC: Moody's

 

[sshafran]

It'll be an interesting AEP and usually we don't see that coming until August - AEP just about closed and companies were already signaling no bueno.

 

[Chazm]

Thankfully I live in FL. We've have good plans since I've been in the biz. I hope you guys make it out Ok.

Oh wait. I've been hearing that plans will get worse since '09. Carry on.

 

[DonP]

Thankfully I live in FL. We've have good plans since I've been in the biz. I hope you guys make it out Ok.

Oh wait. I've been hearing that plans will get worse since '09. Carry on.

I promise you fla plans will also take a big hit . That hit could create chaos and much plan movement . Means if an agent has a big book he has to play defense big time . CO's got hit hard and must retrench . There masters are the stock mkt and they demand profits .3 times a week since Jan 1st every email i get from Humana is about med sups and the bonus . They're turning hard as they're most exposed % wise than any other mapd company as that's 90% of their business . Aetna,United and anthem have big med sup and commercial health ins businesses to smooth out the mapd chaos coming .

 

[me112233]

They cut their earnings est's for 2024 in 1/2 . Medical usuage is soaring . This will also affect med sups big time . I expect sup rates to soar and mapd benefits to plunge in 2025.

It would be great, as in absolutely fantastic, if the MA market returned to be being only about medical care, instead of cash kickbacks and money to pay rent with. People are enrolling in these MA/MAPD plans for all the wrong reasons. At least 50% of my MA customers don't even ask about copays or provider networks (and some even seem annoyed that I tell them about it anyway), they just want to know how much their "giveback" benefit is and/or how much a month they get to buy groceries and OTC products with.

 

[InsuranceGuy29]

Cigna's Medicare sale is an uphill battle for HCSC: Moody's

It's going to be a difficult task for Health Care Service Corp. to turn Cigna's Medicare business into a financially successful endeavor, according to a Moody's analysis shared with Becker's.

"We estimate that Cigna's MA business has struggled to be profitable in recent years," the analysts wrote Feb. 5. "Therefore, it will take effort, time and resources to sustainably improve performance."

Cigna reached a deal in January to sell its Medicare business to HCSC for $3.3 billion, which is expected to close in early 2025. The sale includes Cigna's Medicare Advantage, supplemental benefits, Medicare Part D offerings, and CareAllies, a value-based care management subsidiary. The deal will free up $400 million in financial reserves for Cigna, making the total value of the deal $3.7 billion.

The sale is a credit positive for Cigna because its Medicare business has underperformed in recent years, according to Moody's. While the sale proceeds are likely to be used for share repurchases, they will also be used to reinvest in the company's health services business, Evernorth, and other insurance segments.

The acquisition is a credit negative for HCSC because of the large risks involved with integration, which the company has limited experience with. Despite those concerns, the acquisition may prove positive in the long term because of the large boost HCSC will see in Medicare Advantage membership, according to Moody's.

[EXTERNAL LINK] - Cigna's Medicare sale is an uphill battle for HCSC: Moody's

I can't imagine how Cigna wasn't profitable when they were giving away $20,000 in yearly dental benefits. Again I say......twenty THOUSAND in dental benefits. How could this unprofitability have happened????

 

[sshafran]

It would be great, as in absolutely fantastic, if the MA market returned to be being only about medical care, instead of cash kickbacks and money to pay rent with. People are enrolling in these MA/MAPD plans for all the wrong reasons. At least 50% of my MA customers don't even ask about copays or provider networks (and some even seem annoyed that I tell them about it anyway), they just want to know how much their "giveback" benefit is and/or how much a month they get to buy groceries and OTC products with.

When my med supp clients now ask about or call complaining about not having OTC my default phrase is: "Unfortunately your plan does not give you a card for OTC. I'll happily change you to a good plan that has that. Now remember, your plan pays the 20% out of pocket for chemo infusions and has no copays for hospitals, MRIs, or surgeries.

We can swap that for about 80% coverage in medicare advantage, but you'll get free toothpaste.

Just trying to show the absurdity of it being a major factor.

I don't care that it's there and really, I like MAPD plan so not opposed to them changing. But these are people that I've already talked to about MA at some point in the past when first signing them up so they're likely pre-dispised to being more conservative with their health insurance. It's just a quick way of helping them see the absurdity of it all.

 

[sshafran]

I can't imagine how Cigna wasn't profitable when they were giving away $20,000 in yearly dental benefits. Again I say......twenty THOUSAND in dental benefits. How could this unprofitability have happened????

Never saw one of those as they aren't here but I heard thru the grapevine that they had limits like x dental implants per year - so I doubt many people found a way to "spend" all that dental. I'm sure though some with major dental needs went straight to it just for the dental.

 

[DonP]

Never saw one of those as they aren't here but I heard thru the grapevine that they had limits like x dental implants per year - so I doubt many people found a way to "spend" all that dental. I'm sure though some with major dental needs went straight to it just for the dental.

I was going to say same thing . The $20k is just a # . Most have limits like 1 to 2 crowns or implants a yr . The biggest scam of dental is member has $3 k of dental . Goes in for $2k basic dentures and comes out with a bill of $2 k. 60% of the time they cheat these people telling them tons of things not covered . Your analogy of people wanting free stuff is just human nature . It's no different than a hail storm . You see the one neighbor get a roof then another and another . Then the letters start coming in from roofers about getting a free roof . Well hell I want a free roof