With a 10 percent increase in Medicare Advantage enrollment since August 2011
and an additional 3.3 million aging into Medicare in 2013, “there is ample
opportunity for health plans to gain membership during the 2013 open enrollment
period,” according to an analysis
of Centers for Medicare & Medicaid Services data released Aug. 28.
“With the 2013 Medicare Advantage selling season just weeks away, health
insurers are busy analyzing how their products and pricing strategies stacked up
against competitors in 2012,” Mark Farrah Associates said in a report that
looked at “snapshots” of the 2012 marketplace.
Plans may begin marketing their 2013 benefits Oct. 1, in advance of CMS's
annual election period, from Oct. 15 to Dec. 7.
“Sales and marketing executives are considering various scenarios to
determine how best to differentiate 2013 products from competitors and deploy
sales force resources and scarce advertising dollars to maximize opportunities
and win new business in key markets,” the report said.
With 50.2 million people eligible for Medicare as of August 2012, aggregate
MA enrollment was about 13.7 million members as of Aug. 1, it said.
Total standalone prescription drug plan (PDP) enrollment was 19.9 million as
of Aug. 1, an increase of nearly 1.17 million members, or 6.3 percent, from
The number of PDPs declined, however, from 1,134 in 2011 to 1,063 for 2012,
while the number of MA plans (not including special needs plans or employer
plans) for 2012 increased from 1,735 to 1,974.
The number of regional preferred provider organizations offered remained
relatively small, with 54 plans available in 2012, down from 59 in 2011.
In comparing data on CMS's plan finder tool, the report found that the
disparity in monthly premiums and out-of-pocket expense estimates “can be quite
significant across plans.”
In Los Angeles County, for example, the report compared annual beneficiary
cost estimates for health maintenance organization plan options with
The Kaiser Permanente Senior Advantage plan covers 95,518 members, although
it has a higher annual beneficiary out-of-pocket cost ($3,200) than the Health
Net Healthy Heart plan ($2,900) with just 2,442 members.
“Health plan quality ratings may also play an important role in understanding
why one plan does better in a specific market than another,” the report said.
“Kaiser's five-star rating and the benefits that go along with exemplary rating
most likely contributed to its large enrollment in the Los Angeles market.”
The analysis is at http://www.markfarrah.com/healthcare-business-strategy/Medicare-Advantage-Competition-Analysis.aspx.