What 7 payers said about Medicaid redeterminations

Payer executives are expecting to lose members in their Medicaid managed care contracts as states begin the redetermination process, but some are hopeful to convert some of these members to other lines of business. 

States will begin unwinding the continuous coverage requirements that kept many on Medicaid through the public health emergency April 1. 

December estimates from the Urban Institute and Robert Wood Johnson Foundation show that up to 18 million people could lose Medicaid coverage when redeterminations begin. 

As of 2020, 72 percent of Medicaid members were enrolled in managed care contracts managed by private insurers, according to Kaiser Family Foundation.

Here's what seven payers told their investors about the impact of redeterminations in earnings calls: 

1. Centene CFO Drew Asher told investors on a Feb. 7 call the payer expects to lose 2.2 million members over the next 18 months. 

The company expects to add 200,000 to 300,000 members to its exchange products as a result of the redeterminations. 

CEO Sarah London said the company is focused on working with state partners to inform members about enrollment requirements and ensuring its reimbursement rates reflect changes in the risk pool. 

"In general, I feel like the industry is aligning and organizing around an approach that will minimize or seek to minimize member abrasion in the process and are allowing us to run alongside our state partners, all of which is positive from our perspective," Ms. London said. 

Centene has 15 million Medicaid members in managed care contracts in 29 states. 

2. UnitedHealth Group CFO John Rex said the company expects to add at least 1 million more commercial members in 2023, some of this growth from redeterminations. 

Tim Spilker, CEO of UnitedHealthcare community and state, said states have taken redeterminations into account when setting rates for 2023. 

"So, we're appreciative of the balanced rational view that our states have taken as they've looked ahead, knowing that we've got many factors coming forward," Mr. Spilker said. 

"We know it will take 10 to 12 months depending on the state. And that will give us opportunities to provide data, feedback and insights to our customers, work with them to adjust as things develop," he added. 

3. Elevance Health CFO John Gallina said there are many uncertain variables with the pace and timing of redeterminations. 

"I think one of the great things about the balance and resilience of our membership base is that, you know, we end up with the members somewhere," Mr. Gallina told investors on a Jan. 25 call. "We have a product offering for every member, regardless of age, regardless of employment status, regardless of health condition." 

Mr. Gallina said the company expects to end 2023 with somewhere between 10.8 to 11.3 million members. The company had 11.5 million Medicaid beneficiaries at the end of 2022, according to its earnings report. 

4. Cigna CEO David Cordani said the company did not factor any potential membership gains from Medicaid redetermination into its earnings guidance. 

Cigna does not currently have any Medicaid business, divesting its contracts in Texas to Molina Healthcare in April 2022. 

"We have not factored in an uptake relative to redeterminations as a contributor in our outlook for the year," Mr. Cordani told investors on a Feb. 3 call. "We recognize that redeterminations present an opportunity for us, not a risk for us because we don't have that business to protect currently."

5. Dan Finke, president of healthcare benefits for CVS, said the company expects modest growth in Medicaid membership through the first quarter of 2023, later offset by redeterminations. 

"But as anticipated, at the end of the first quarter, we do expect some of the redetermined members to fall off the roster," Mr. Finke said on a Feb. 8 call. "And so, we are working closely with the states around our opportunities to regain that membership." 

6. Humana CFO Susan Diamond said though the company is adding Medicaid contracts in Louisiana and Ohio in 2023, the membership gains will be offset by losses from redeterminations. 

"As we've commented previously, the members who had access to Medicaid through the deferral of the redeterminations did tend to be lower acuity and higher contributing. So as they roll off, that would have an impact on the Medicaid [medical loss ratios] as well," Ms. Diamond told investors on a Feb. 1 call. 

7. Molina Healthcare CEO Joe Zubretsky said the company expects its Medicaid membership numbers to stay largely stable, with contracts picked up in Iowa and Wisconsin offsetting losses from redeterminations. 

Executives told investors on a Feb. 9 call state partners are open to readjusting rates if medical loss ratios and utilization shift because of redeterminations. 

"I don't know whether [states are] going to wait until the entire redetermination process is complete," Mr. Zubretsky said. "But it's got to be data driven. So the data has to be complete, and it has to be verifiable and actionable." 

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