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Molina Reels From Medical Expense Molina Healthcare reported Q3 financials and cut its 2025 earnings guidance for the third time this year. It is citing high medical costs particularly in its Exchange line of business. Molina is not the first to report the Exchange medical trend concern. The impacts will only be worse in 2026 if Exchange credits expire, risk increases, and enrollment drops. While Molina revenues beat analyst expectations, the plan missed on earnings. Molina is a Medicaid- and Exchange- dominant health plan with some Medicare Advantage (MA) lives. Molina posted a very-high medical loss ratio (MLR) of 92.6% in the quarter, up from 89.2% at the same time last year. Exchange plans hit a 95.6% MLR, up from 73% same time last year. Medicaid margins were strong but pressured from continued utilization. MA sees high utilization as well. In other news, a mix of Exchange pullouts and some expansions (surprisingly).

Employer Family Coverage Hits $27,000 A Year Healthcare policy group KFF finds from its annual employer survey that family premiums for employer-sponsored health insurance reached an average of $26,993 this year. On average, workers contribute $6,850 annually to the cost of family coverage. Family premiums increased 6%, or $1,408, from last year. KFF says the cumulative increase in family premiums is 26% over the past five years. KFF finds that more workers are in HSA-Qualified Plans as average deductibles have reached $1,886 per year. Additional articles: https://thehill.com/policy/healthcare/5567473-health-insurance-costs-rise-2025/?tbref=hp and https://www.healthaffairs.org/content/forefront/annual-family-premiums-employer-coverage-rise-6-2025-nearing-27-000-workers-paying-6 and https://www.kff.org/health-costs/perspectives-from-employers-on-the-costs-and-issues-associated-with-covering-glp-1-agonists-for-weight-loss/ and https://www.kff.org/affordable-care-act/annual-family-premiums-for-employer-coverage-rise-6-in-2025-nearing-27000-with-workers-paying-6850-toward-premiums-out-of-their-paychecks/ and https://www.kff.org/health-costs/2025-employer-health-benefits-survey/ (Some articles may require a subscription.) #employercoverage #healthcare #coverage https://www.fiercehealthcare.com/payers/new-care-vs-health-insurance-average-family-job-based-coverage-hits-27k ICHRAs Catching Fire But Jury Still Out Three articles on the major interest by employers in so-called ICHRAs, which allow employers to subsidize individual purchases in the Exchanges via health reimbursement accounts. Centene, the nation’s biggest Exchange insurer, and Oscar Health are bullish. Uptake is

Elevance Reports Good News But Cautions On Medicaid Elevance Health reported relatively good financial news for Q3 but warned investors about challenges in the Medicaid market. Ongoing eligibility determinations as well as changes to state programs are increasing the acuity of its membership. The company said its Medicaid margins will drop 125 basis points year over year in 2026 due to the eligibility changes and high utilization. This is before widescale reductions take place under the One Big Beautiful Bill Act (OBBBA). Insurers have complained that state Medicaid rates have not recognized actual costs after post-pandemic policy shifts in enrollment. The other major moving part is the expiration of the enhanced Exchange subsidies, which could leave a sicker cohort and increased risk and costs in that line as well. Elevance also trimmed its Medicare Advantage (MA) footprint to stabilize that line. Its Carelon services entity did not meet investor expectations.

11th Vote To Reopen Government Voted Down By Democrats Senate Democrats voted against reopening the federal government for the 11th time Monday, making the government shutdown continue. The chamber voted 50-43 on the House-passed continuing resolution, which needed 60 votes to pass. The same three Democratic caucusing senators voted with Republicans and one debt-and-deficit-hawk Republican voting with Democrats. At the same time, Senate Majority Leader John Thune, R-SD, said the government shutdown has dragged on for so long that the GOP-controlled House may need to come back to Washington to pass a new stopgap funding bill. There are just 4 weeks left on the measure passed by the House and failing in the Senate. And Rep. Chip Roy, R-TX, floated the use of the “nuclear option” to end the shutdown and get around Senate filibuster rules that require a 60-vote majority to pass a bill. Thune opposes the idea. Thune is

Medicare Advantage Plans Want Fewer Members Modern Healthcare covers a real oddity – Medicare Advantage (MA) plans want fewer members. Given upside down financials right now and the need to get back to investor margins, MA plans are trying all things to ensure they do not get members into plans that are underwater or even less profitable. The past few years and into 2026, the plans are eliminating commissions on a number of their plans and products. In addition, marketing budgets overall appear to be being reduced dramatically. The lack of commissions, reduced marketing, and overall contraction of offerings has led the Centers for Medicare and Medicaid Services (CMS) to predict an actual contraction of 900,000 enrollees in 2026 compared with 2025. I see why they see a sea change, but I still have my doubts that we will see an actual contraction. Clearly growth will come down from a

Hospitals Hate Price Reform: CHA Sues State Over Price Caps The oblivious-to-the-true-healthcare-crisis hospitals are once again trying to cripple reforms to price in the system. The California Hospital Association (CHA) has filed a lawsuit against the state’s Office of Health Care Affordability, arguing the agency’s price caps on hospitals are unlawful and will threaten critical access to patients in need. Chicken Little is back! The arguments are old news from the hospital lobby playbook. The main goal is to continue to safeguard bloated price masters and bureaucracies at the expense of the American people. The state agency is imposing a 3.5% statewide spending growth target for 2025, declining to 3% by 2029, as well as lower targets for existing price outlier hospitals. The CHA hides behind the fact that premiums are increasing by 10%, arguing the efforts have not worked. Yet, much of that is utilization increases as well as

Oz Still Demanding Greater Medicare Advantage Accountability At a Better Medicare Alliance event Wednesday, Centers for Medicare and Medicaid Services (CMS) Administrator Dr. Mehmet Oz declared his support for Medicare Advantage (MA) but argued the plans could improve in several areas. Specifically cited were improper payments and prior authorization. Oz previously announced a voluntary plan agreement to streamline and limit prior authorizations as well as a new CMS program to conduct risk adjustment audits on 100% of MA contracts every payment year. The latter initiative was hit with a major roadblock when a federal judge struck the rule governing how the agency would carry out such audits. CMS did not respond to a request for comment on whether it plans to repromulgate the audit rule and Oz stayed mum during the event but has implied he wants to continue the robust audit efforts. Oz specifically called out the use of

Lown Finds Overuse Of Unnecessary Back Surgeries The respected Lown Institute, a healthcare researcher and policy group, has found that hospitals performed over 200,000 unnecessary back surgeries on older adults over a three-year period in Medicare. The hospitals billed a total of more than $1.9 billion for what Lown says are low-value services. Lown also found that 60% of total overuse for spinal fusion/laminectomies came from the 10% of worst offender physicians. It notes that these unnecessary procedures cause a rise in serious complications. One example: spinal fusion complications occur in up to 18% of patients and can lead to stroke, pneumonia, or death. Lown looked at Medicare fee-for-service (FFS) claims from 2021 to 2023 and Medicare Advantage (MA) claims from 2020 to 2022 for rates of spinal fusions/laminectomies and vertebroplasties that met the researchers’ criteria of a low-value procedure based on the patient’s clinical presentation at the time of

More Star Rating News Modern Healthcare has done a follow-up Star rating article. It notes that several provider-owned insurers saw big drops in the percentage of Medicare Advantage (MA) members in plans rated at least four Stars. Some Blue Cross and Blue Shield companies also reported declines. Startup insurers also had mixed reviews. Among the plans getting hit: Big Blue winners included: (Article may require a subscription.) #cms #medicareadvantage #stars #quality https://www.modernhealthcare.com/insurance/mh-medicare-advantage-ratings-2026-bcba-clover-health Government Shutdown Politics As the government shutdown continues, there is both public jockeying as well as quiet deliberation on the issue of Exchange healthcare subsidy extensions. Vice President JD Vance said that the enhanced subsidies fuel waste and fraud in the insurance industry. Sen. Mark Kelly, D-AZ, said a hypothetical commitment from Republicans to hold a vote by the end of the year on extending the  subsidies would not be sufficient to secure Democratic support for reopening government.

Trump Strikes Drug Price Deal With AstraZeneca A second brand drug maker has struck a deal with President Donald Trump on lowering drug prices. AstaZeneca agreed to terms similar to Pfizer with a few additions. The agreement provides that all drugs in Medicaid are subject to most-favored-nation pricing. As well, AstraZeneca will offer medicines at a deep discount off the list price when selling directly to American patients. The drugs will appear like Pfizer’s on the new TrumpRx website. Three items are not seen in the Pfizer deal. AstraZeneca agrees that MFN will apply to future innovator drugs introduced. AstraZeneca will repatriate increased foreign revenue on existing products that AstraZeneca realizes. And the company will invest $50 billion in U.S. manufacturing and research and development. The deal will exempt AstraZeneca from the 100% tariffs the Trump administration wants to impose on brand drugs. In a blog this week, I questioned