Despite Hardball Tactics With Home Health Providers, MA Plans Have High Gross Margins

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Despite Hardball Tactics With Home Health Providers, MA Plans Have High Gross Margins

Posted by - Latinos MediaSyndication -

on - March 1, 2023 -

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Insurers are reporting much higher gross margins per enrollee in the Medicare Advantage (MA) market than in other health insurance markets, according to a new Kaiser Family Foundation analysis.

At the same time, many Medicare Advantage plans continue to play hardball with home health providers by rationing utilization and offering low rates.

The KFF analysis took a look at financial data in four insurer markets: Medicare Advantage, Medicaid managed care, individual (non-group) and fully insured group.

In 2021, MA insurers reported gross margins averaging $1,730 per enrollee. That was at least double the margins reported by insurers in the individual/non-group market ($745), the fully insured group/employer market ($689) and the Medicaid managed care market ($768).

Source: KFF

There is still some margin pressure for MA plans, as the Centers for Medicare & Medicaid Services (CMS) is looking to increase oversight of them and claw back overpayments in the near-term future.

While MA pays almost the same as traditional Medicare in a hospital setting, for instance, skilled nursing facilities and home health agencies are often paid far less by MA for services.

“Medicare Advantage plans have both higher average costs and higher premiums (largely paid by the federal government) because Medicare covers an older, sicker population,” KFF reported. “While Medicare Advantage insurers spend a similar share of their premiums on benefits as other insurers in other markets, the gross margins — which include profits and administrative costs — of Medicare Advantage plans tend to be higher.”

The post Despite Hardball Tactics With Home Health Providers, MA Plans Have High Gross Margins appeared first on Home Health Care News.

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