More Bad News On Affordability Front
A new Commonwealth Fund report finds that middle-income workers and their families are spending an average of 10.1% of median income on their health premiums and deductibles. The 2024 data from the employer-sponsored insurance market show that premium contributions for family coverage ranged from an average of $5,584 in Oregon to $9,148 in California. In 19 states, the average premium and deductible contribution topped 10% of that state’s median income. Costs varied by region, industry, and employer size. Five states’ costs breached the affordability metric under the Affordable Care Act (ACA), which could trigger coverage in the Exchanges.
The researchers recommend employers adjust out-of-pocket requirements and premiums based on the income of employees. The report also notes one of my key reform recommendations – a shift in the broader trends around healthcare pricing and spending.
#healthcare #coverage #affordability
Payers Continue Convincing Investors All Will Be Well
Health plans and investors both took it on the chin the past few years due to perceived poor financial discipline and oversight. Since that time, investors have been more jaded when it comes to their views on insurers. Now, insurers are on a campaign to convince Wall Street it is on its way to solid financial footing. Some insurers, though, have already lowered 2026 outlooks.
The skepticism is warranted. Insurers so fundamentally missed the mark over the past few years. Some accused the biggest company, UnitedHealth Group, of actually hiding its impending financial collapse.
Do plans have it right now in terms of predicting revenue, expense, and margins and that they will return to target profitability? They say 2026 remains a transition year and they get back to target margin in 2027.
But there remain potential headwinds. MA has high utilization trends and a potential flat 2027 rate hike. Medicaid will see major cutbacks due to the One Big Beautiful Bill Act (OBBBA) and limits on state provider taxes. Exchange subsidy enhancements have sunset. Despite initial disenrollment losses being low in 2026, plans say there will be a high rate of premium delinquency. And the commercial world is facing unprecedented cost trends, leading to skyrocketing premiums.
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#healthplans #margins #medicareadvantage #commercial #employercoverage #medicare #exchanges
https://www.modernhealthcare.com/insurance/mh-unitedhealth-cvs-humana-2026-earnings
Winners And Losers in MA Open Enrollment
A good Modern Healthcare analysis on the results of the Medicare Advantage (MA) open enrollment season. I published a blog on Monday here: https://www.healthcarelabyrinth.com/2026-medicare-advantage-enrollment-season-good-news-bad-news/
Of course, my reported growth is slightly different than Modern’s, but that is related to different assumptions and starting points. Modern reports Humana, Devoted Health, and Scan were the big winners. UnitedHealth Group and Elevance Health were the big losers.
(Article may require a subscription.)
#medicareadvantage #enrollment
MedPAC Clarifies MA Overpayments
For years MedPAC has been touting that Medicare Advantage (MA) rates are entirely overpaid and the press has picked up on the claims. But now MedPAC has a bit of a problem. It often underscores how both favorable selection and coding intensity contribute to the overpayments. But with the new v28 model phase-in complete, even MedPAC’s numbers are coming down. In January, it admitted coding overpayments will have dropped to about 4% above the fee-for-service (FFS) program. Now, in a blog in Health Affairs Forefront, MedPAC officials do a good job of explaining the change as well as how its numbers compare with a recent analysis done by Centers for Medicare and Medicaid Services (CMS) officials.
The blog discusses MedPAC’s 4% assumption by applying v28 to CMS’ 2% assumption. The difference is largely because of MedPAC’s accounting for a trend in coding. It says that both CMS’ and MedPAC’s analyses indicate that uncorrected coding intensity is substantially lower under v28 relative to what occurred under v24. It is v24 that has gotten all the headlines. Earlier, coding intensity payments above the adjustment in the rates had reached about 10%.
MedPAC still believes favorable selection in MA is huge at over 10%. That combined with the 4% above will continue to generate headlines. It cites other studies as well to bolster its claims. I have taken issue with some of their calculations, especially as it relates to beneficial selection. MedPAC’s analysis on selection is far from scientific. Other studies point to MA doing a good job of taking in the low income and the most vulnerable.
(Article may require a subscription.)
#medicareadvantage #radv #riskadjustment #overpayments
— Marc S. Ryan
