Dive Brief:
- Milliman has released its annual report on Medicaid risk-based managed care with an analysis of financial results for 2014. Results show that the number of risk-based Medicaid managed care plans has increased from 150 in 2010 to 182 in 2014. Revenues have doubled to $110 billion within the same frame, due in part to Medicaid expansion.
- Although revenues have doubled, the report found that the medical cost ratio has not changed much—83.5% in 2010 and 86% last year.
- The average reflects a high variability in medical cost ratios, with 111 of the plans showing a profit and 71 posting a loss.
Dive Insight:
Study authors and Milliman actuaries Jeremy Palmer and Christopher Pettit wrote that "Healthcare delivery and premium revenue are believed to vary by geographic location." For example, medical cost ratios for MCOs range from 77.6% in Nevada with UnitedHealthcare and Anthem subsidiaries reporting a profit, to 98.8% in North Dakota where Sanford Health Plan lost money.
How did provider-sponsored plans fare? The report included 27 provider-sponsored plans, of which 16 reported a profit in 2014. All provider-sponsored plans in Wisconsin except one posted a financial gain. In Pennsylvania, UPMC Health Plan showed a profit, but Geisinger Health Plan reported a loss. Kaiser Permanente Foundation Health Plan had a loss in Maryland and Hawaii.