From the start of Medicaid redeterminations to short-lived megamergers, these are the 10 most read health insurance stories reported by Becker's in 2023:
1. Industry-wide layoffs
From the largest conglomerates to small regional organizations, insurers trimmed their workforces and cut jobs this year due to financial or operational challenges, along with restructuring strategies influenced by broader industry and regulatory trends. In 2023, Becker's reported layoffs at UnitedHealth Group, Elevance Health, Aetna, Cigna, Humana, Centene, Blue Cross Blue Shield companies, and more.
2. Health system-payer negotiations went awry
Contract negotiations between health systems and insurers are a common occurrence across healthcare, but every so often talks disintegrate and disputes make their way into the public eye. Recent data has suggested that these negotiations are becoming more public, and the number of communities affected across the country is growing. In 2023, notable disputes included Cincinnati-based Bon Secours Mercy Health and several Anthem Blue Cross Blue Shield plans, along with Greenville, S.C.-based Prisma Health and UnitedHealthcare.
3. Hospitals pushed back against Medicare Advantage
At least 15 hospitals or health systems nationwide dropped some or all contracts with Medicare Advantage plans in 2023, citing excessive prior authorization denial rates or slow payments from insurers. While the trend is not an occurrence in the majority of the nation's health systems, hospital executives and state associations were more candid with their critiques of the program this year. One payer CEO called the tensions a "short-term trend that is going to backfire," and many health systems are expanding their own Medicare Advantage subsidiaries in 2024.
4. Health plans constricted weight loss drug coverage
As demand for GLP-1s continues to surge, payers and self-insured employers have consistently ended or limited coverage for weight loss medications over the last year, including several major health systems. Several state employee health plans grappled with how to cover the high cost of the drugs, with some implementing limitations around coverage of the expensive medications. The country's largest insurer, UnitedHealth Group, told investors in October it wants to lower the price of weight loss drugs, but it needs drug manufacturers to get on board.
5. Medicare Advantage star ratings declined
CMS' overall average star ratings declined slightly for Medicare Advantage plans, falling from 4.14 in 2023 to 4.04 in 2024. Plans must earn at least a four-star rating to receive quality bonus payments from CMS. Elevance Health expects to lose around $500 million in revenue in 2025 as a result of declining star ratings.
6. UnitedHealthcare cut prior authorization requirements
The country's largest insurer eliminated 20 percent of its prior authorization requirements in the fall for most commercial, Medicare Advantage and Medicaid plans. The company also said it will implement a national gold-card program in early 2024.
7. Medicaid redeterminations have been a major challenge
It's been eight months since the first states began the process of unwinding the continuous Medicaid enrollment period in place for three years during the pandemic, resulting in state agencies and beneficiaries reporting major operational challenges and exacerbated care access issues. Anonymously, executives with some of the nation's largest Medicaid managed care insurers have described the redeterminations process as "chaotic" to Becker's. As of Dec. 20, more than 13 million people have been disenrolled from Medicaid across all 50 states and Washington, D.C., with 71% of those individuals losing coverage for procedural reasons rather than being determined ineligible, according to KFF. How procedural disenrollment rates are calculated varies by state, but high rates suggest many people that have lost coverage may still be eligible for Medicaid. Half of states are "failing" amid the redetermination process, according to the NAACP, and CMS has laid out how it will sanction states that do not comply with redetermination requirements.
8. A short-lived merger plan between Cigna and Humana
In November, the Wall Street Journal reported that Cigna and Humana were "in talks" to merge through a stock-and-cash deal finalized by the end of 2023. The merger would have created one of the largest healthcare companies in the U.S., rivaling other health services giants such as UnitedHealth Group, Elevance Health and CVS. The WSJ report came after Reuters reported Nov. 6 that Cigna was exploring a potential sale of its Medicare Advantage business. In December, the WSJ said the deal had been called off following a disagreement over price and other financial terms. Cigna said Dec. 10 it is planning an additional $10 billion of stock buybacks, raising its total planned repurchases to $11.3 billion, and considering "bolt-on acquisitions" and "value-enhancing divestitures."
9. Payers partnered with Mark Cuban's drug company
It was a busy year for Mark Cuban Cost Plus Drug Co., which launched or inked partnerships with Capital Blue Cross, Blue Shield of California and Select Health, the insurance arm of Salt Lake City-based Intermountain Health. As Cost Plus has worked to make drug pricing more transparent, insurers and PBMs also launched or announced new pharmacy models and products this year, including Express Scripts, CVS Health, Optum Rx and Elevance Health.
10. A Medicare Advantage executive is charged with fraud against the U.S.
A former executive with Elevance-owned HealthSun Health Plans was charged with allegedly orchestrating a multimillion-dollar Medicare Advantage fraud scheme. The scheme allegedly caused HealthSun to submit tens of thousands of false claims to CMS, which resulted in millions of dollars in overpayment. The Justice Department declined to prosecute HealthSun directly because of the organization's voluntary self-disclosure and agreement to repay $53 million in overpayments. Florida-based HealthSun was acquired by Elevance Health in 2017.