Oscar Health Slashes Earnings Guidance
The trend continues of large health plans surprising The Street with major slashes in guidance with little or no notice. While its Q2 investor call is not until August 6, Oscar Health announced today it is slashing its full-year guidance by about half a billion dollars. The insurer expects a loss from operations of $200 million to $300 million just months after estimating earnings from operations of $225 million to $275 million. Elevated utilization is a big culprit. Oscar’s medical loss ratio is climbing to between 86% and 87%, more than 5% higher than initially forecast.
Oscar had an operating loss of about $230 million in Q2, when analysts expected an operating profit of $55.5 million.
Oscar is a 100% Exchange plan. Revenue and margin concerns likely will continue given the expiration of the enhanced premium subsidies and enrollment tightening in a new rule and the budget reconciliation bill. Enrollment is slated to drop in 2026.
Additional articles: https://www.fiercehealthcare.com/payers/oscar-health-cuts-full-year-guidance-estimates-2025-loss-aca-marketplace-stumbles and https://www.modernhealthcare.com/insurance/mh-oscar-health-aca-marketplace-obamacare/
(Some articles may require a subscription.)
#oscar #exchanges #healthplans #margins
https://www.beckerspayer.com/payer/oscar-health-is-latest-insurer-to-cut-earnings-guidance/
But Wait! Humana Refiles Star Lawsuit
Just three days after a federal judge ruled against Humana’s Medicare Advantage Stars suit, the Medicare Advantage-dominant health plan refiled the suit. The judge had indicated the plan did not exhaust administrative appeals. Post the lawsuit, it did and that allows the plan to refile.
The issues in the first suit were numerous and biting, attacking the Star process in general. Fewer are in the second suit, including questioning scoring of call center measures.
In other news, Humana announced its plans for limiting prior authorization (PA) in light of an agreement between the health plan industry and the federal government. Humana plans to cut one-third of its prior authorization requirements for outpatient services. Humana also said it will provide decisions within one business day on at least 95% of prior authorizations by next year. It will launch a gold card program for trusted providers to further limit PA. It will publicize PA metrics and advance interoperability for PA submissions.
Additional articles: https://www.fiercehealthcare.com/payers/humana-joins-chorus-lawsuits-over-sinking-star-ratings and https://www.modernhealthcare.com/insurance/mh-humana-prior-authorization-gold-card-program/ and https://www.fiercehealthcare.com/payers/humana-makes-commitments-streamline-prior-authorization-process and https://www.healthcaredive.com/news/humana-refiles-medicare-advantage-star-ratings-suit-prior-auth/753658/
(Some articles may require a subscription.)
#priorauthorization #stars #quality #humana
https://www.beckerspayer.com/legal/humana-refiles-medicare-advantage-ratings-challenge
Doc Fix Could Lower Specialty Care Rates and Increase Primary Care
Physician groups have universally panned the proposed 2026 Medicare payment rule as insufficient. It, too, lacks a long-term fix. But as with Trump 45, the second Trump 47 administration is seeking to rebalance physician payments. The rule proposed would over time lower payments to specialists in favor of freeing up more money for primary care doctors. Physician groups are attacking the proposal but it makes sense to ensure better availability of revenue over time for primary care.
Low rates in Medicare has decimated primary care, leading independent physicians to shutter practices and work for health systems and hospitals. There the docs are told to change practice patterns and utilize more expensive hospital-owned settings.
(Article my require a subscription)
#siteneutral #medicare #physicians #rates
https://www.modernhealthcare.com/politics-regulation/mh-cms-physician-fee-schedule-billing-codes
HHS Launches Investigation Of MA Marketing
The Department of Health and Human Services (HHS) is launching a study of misleading Medicare Advantage (MA) marketing practices and the harm it does to beneficiaries. The study will focus on complaints received by CMS from 2020 to 2024. The final study is expected to be released in 2026.
In May, the Department of Justice (DOJ) sued Humana, Aetna, and Elevance, along with brokers eHealth, GoHealth, and SelectQuote. The suit accuses the plans of engaging in a multi-year scheme to pay millions of dollars in kickbacks to the brokers to steer beneficiaries toward specific plans.
#medicareadvantage #marketing #hhs
MASS DOI Rejects Exchange Rate Hikes
The Massachusetts Department of Insurance (DOI) has rejected Exchange rate proposals for 2026 from Blue Cross Blue Shield Massachusetts (BCBSMA) and WellSense Health Plan. WellSense requested a 16.2% rate hike, while BCBSMA requested a 12.9% increase. Other plans had rates approved in a range from 7.1% to 12.2%.
#exchanges #healthplans #rates #ma
https://www.beckerspayer.com/payer/massachusetts-rejects-2-payers-proposed-aca-rate-hikes
AstraZeneca Commits $50 Billion To Onshoring
British-Swedish brand drug maker AstraZeneca announced a $50 billion investment in the U.S., which could grow to $80 billion. The move comes from Trump’s urging brand drug makers to reshore research and production as well as the threat of tariffs on drugs. The company will build a new center in Virginia and enhance existing facilities in five other states.
#drugpricing #branddrugmakers #tariffs
— Marc S. Ryan
