Medicaid enrollment is leveling off after years of steady growth fueled by Medicaid expansion in 32 states, but managed care plans will continue to be a boon for private insurers.
Over the last four years, Medicaid expansion under the Affordable Care Act has triggered dramatic enrollment growth within the Medicaid program, according to a report from PwC. More than 75 million people were enrolled in Medicaid in 2016 up from 57.7 million in 2013. Although overall enrollment has slowed to 3 percent over the last year, the Medicaid program still covers nearly a quarter of the country’s population.
A large portion of Medicaid enrollees are covered under Medicaid managed care plans operated by private insurers. As of this year, 54.7 million beneficiaries were enrolled in a Medicaid managed care plan, a 60 percent increase from 2013. Currently, managed care plans account for 73 percent of Medicaid enrollees. In several states, 100 percent of the state’s Medicaid population is overseen by a private carrier.
The report notes that as the Medicaid program takes on a bigger role within the nation’s healthcare system, insurance carriers should “prepare for greater scrutiny, but also improved opportunities to demonstrate their part in delivering healthcare value.” Although Medicaid enrollment is likely to level off following several years of expansion, growth within the managed care market is expected to continue as more states transition Medicaid beneficiaries from fee-for-service models to privately run plans.
The nation’s largest insurers have reported significant growth within Medicaid business lines, both in terms of enrollment and profitability. WellCare and Molina have previously attributed Medicaid expansion to strong financial gains, a stark contrast to some insurers' climbing losses on ACA marketplace plans.