Medicare Advantage plans, with their reduced or free premiums and low out of pocket costs, have been a great help to many people. According to new data, the Advantage program looks ready to have another positive year of growth in 2018.
Reviewing enrollment information from the Centers for Medicare & Medicaid Services, Jefferies analysts stated that total MA participation has increased 4.2% between December 2017 and January 2018. This is similar growth to the start of last year and indicates a strong showing for the coming months.
Group MA enrollment is showing the largest jump, at 10.3%. This is slightly lower than the 12.7% seen for this period last year, but last year was also the highest growth the program has experienced, so having such a small drop is a great sign. Individual MA enrollment is “modestly accelerating” which tells us that growth in this sector will continue to expand and possibly beat the 6.1% achieved last year.
Medicare Advantage is unique in the way it partners with traditional private insurers. Most companies have been on target with expectations in terms of number of new enrollments, UnitedHealthcare’s enrollment, for example, grew 7.3% while Humana added 5.8%. Aetna, however, was a real star, with 13.4% MA enrollment growth, which is the fastest among publicly traded stocks this year.
The continued growth of Medicare Advantage, fueled by relatively stable federal funding and aging baby boomer population, is keeping the health insurance sector on solid ground right. Insurers are becoming increasingly dependent on Medicare and Medicaid for both profits and growth, with those two business lines making up almost 60% of the revenues of the country’s five largest publicly traded insurers.
That said, there is no sure thing given the state of the political landscape right now, and continued wrangling in Washington D.C. over reform or repeal of federal healthcare. It’s important for us, as medical professionals, to stay abreast of the business side of healthcare to keep our practices as healthy as our patients.
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