UnitedHealth, Aetna to join major Medi-Cal markets

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UnitedHealth and Aetna are poised to join the Medi-Cal market in San Diego and Sacramento counties, according to California Healthline.

“Medi-Cal is a good business to be in,” healthcare consultant Stan Rosenstein tells the publication. The Medicaid managed care program is situated in the nation’s most populous state, serving 13.4 million people, or roughly one-third of Californians. Currently, 22 insurers participate in Medi-Cal.

For Aetna, the California Medicaid market constitutes “the next logical step” for increasing services to Medicaid beneficiaries, according to a company spokesperson.

United and Aetna also will look to capitalize on future opportunities in the Medi-Cal space, the article says. Enrollment in the Medicaid program is up 40 percent since the Affordable Care Act opened eligibility to include single, childless adults and people with higher incomes.

Successful rollouts in the two counties could drive more business from California for the insurers when the state allows new insurers to enter other counties. 

California is in the bottom 10 for spending at $6,000 per enrollee. Still, United is optimistic, telling the publication that limited Medicaid resources have not prevented success in many other states.

The start date for United and Aetna to participate will be July 2017 or later. Participation is contingent upon proof that the insurers have an adequate network of physicians located within reasonable distance of enrollees, the state Department of Health Care Services said.

The department has previously received complaints for insufficiently ensuring that Medi-Cal managed care plans provide adequate coverage. 

Medicaid managed care is proving to be a boon for some health insurance companies thanks to Medicaid expansion. In the Medi-Cal markets they plan to enter, United and Aetna will find themselves competing with carriers including Centene and Molina that specialize in the Medicaid managed care market, potentially reducing their market share. 

- read the California Healthline article