Here are six key points on the HMO’s financials.
1. Molina Healthcare of Michigan, which is owned by Molina Healthcare of Long Beach, Calif., recorded $82 million in underwriting income last year, up from $41 million in 2014 and $25 million in 2013, according to the report, which cites financial data filed with the Michigan Department of Insurance and Financial Services. The insurer recorded a 6.7 percent profit margin in 2015.
2. Meridian Health Plan of Michigan, a family-owned plan based in Detroit and the state’s largest Medicaid HMO, saw its underwriting margin rise to 1.3 percent last year from 1 percent in 2014 and 0.6 percent in 2013. At the same time, Meridian’s medical expenses increased 13 percent to $321 per member per month last year from $283 in 2014. Meridian COO Jon Cotton told Crain’s Detroit Business the increase in medical expenses is due to costs associated from a somewhat sicker Healthy Michigan population, as well as from other populations many of the plans absorbed during the past several years.
3. Southfield, Mich.-based UnitedHealthcare Community Plan, which is owned by the nation’s largest HMO, Minnetonka, Minn.-based UnitedHealthcare Group, recorded $79.1 million in underwriting income in 2015, a 65 percent increase from $47.9 million the year prior, Crain’s Detroit Business reports. In 2013, the year before Healthy Michigan Medicaid expansion began, the plan lost $8.7 million.
4. Priority Health Choice, a nonprofit plan owned by Grand Rapids, Mich.-based Spectrum Health System, also saw positive income during the Healthy Michigan expansion, according to the report. Medicaid underwriting income surged to $13 million last year, after experiencing losses of $1.3 million in 2014 and $1.2 million in 2013, the report states. Priority Health Choice recorded a profit margin of 2.9 percent in 2015.
5. Harbor Health Plan, which is owned by Dallas-based Tenet Healthcare, was also able to turn around its operation, recording $8.5 million in underwriting income on Medicaid in 2015, compared to $651,000 in 2014, according to the Michigan Department of Insurance and Financial Services. That was after losing $41,000 in 2013 when Tenet acquired the former ProCare Health Plan. In Crain’s Detroit Business, Harbor Health CEO Mehrdad Shafa, MD, attributed the plan’s financial improvement to several factors, including early medical intervention, outreach efforts to promote healthy lifestyles and Medicaid expansion.
6. While profits have surged at Michigan Medicaid HMOs, at least five HMOs, including Meridian and Molina, will be required to repay the state for overpayments they received based on “risk-corridor” provisions in the Medicaid contract, according to Crain’s Detroit Business.
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