Despite impending payment cuts, health insurance companies won't walk away from Medicare Advantage--thanks in part to a growing Medicare population and the incoming generation's comfort with managed care, Managed Healthcare Executive reported.
To stay ahead in the Medicare Advantage business, insurers should keep the following two concepts in mind:
1. Enhance offerings
Ignore the impulse to offer members "less for more" in the face of a 5.9 percent payment cut in 2015, Managed Healthcare Executive noted. Long-term viability in Medicare Advantage calls for product enhancements, such as hearing or dental benefits, that are selling points for seniors. In fact, a December 2013 survey from WellPoint found baby boomers value dental coverage benefits and would pay more for comprehensive dental coverage.
2. Focus on quality
Quality ratings provide a financial opportunity for insurers. The termination of contracts with plans consistently scoring fewer than three stars will free up market share for the remaining high-quality plans, the article noted.
"Improved quality scores for Medicare Advantage plans could be the difference between making and losing money," Matt Eyles, executive vice president at Avalere Health, told the publication.
Moreover, insurers should recognize the link between Medicare Advantage star ratings and enrollment: When Medicare Advantage insurers have a higher star quality rating, they see greater enrollment numbers, according to a January 2013 study published in the Journal of the American Medical Association. The researchers found when insurers improved their rating by one star, they also boosted their enrollment by 9.5 percent.
Narrow networks also can help enhance quality in the midst of Medicare Advantage cuts, as more efficient providers will lead to better outcomes and financial benefits.
- read the Managed Healthcare Executive article