The largest Medicare Advantage insurers want to cut benefits, increase premiums and make other structural changes to their plans next year to account for higher-than-anticipated medical expenses this year
Humana expects higher cost trends to persist throughout the year, and aims to offset them by dipping into investment income and reserves, and cutting some administrative functions. The company built these cost considerations into its Medicare Advantage bids for the next plan year, which were due to regulators on June 5.
UnitedHealth Group and Humana combine for a 46.5% market share in the lucrative Medicare Advantage market
UnitedHealth Group reassured investors that it holds adequate reserves to cover medical expenses, and that it priced for these trends in its Medicare Advantage bids for 2024
Regulators tightened how private Medicare plans are audited, paid and reviewed for quality, leading some insurers to say they would pare back supplemental benefits. The Centers for Medicare and Medicaid Services also tinkered with the risk-adjustment model, although both UnitedHealth Group and Humana said its three-year phase-in gives them sufficient time to adapt.
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