Julia Friedman

All MAOs are confined by competitive pressures in their markets and, in most cases, they are unable or reluctant to make large benefit changes or premium changes in a single year. Changes also vary by MA plan type and the size of the MAO, or, for example, if the MAO is trying to maintain a $0 premium on specific plans. National plans1 are typically able to leverage economies of scale to ensure they can continue to offer competitive premiums and benefits. Regional plans, however, typically are… Show more

All MAOs are confined by competitive pressures in their markets and, in most cases, they are unable or reluctant to make large benefit changes or premium changes in a single year. Changes also vary by MA plan type and the size of the MAO, or, for example, if the MAO is trying to maintain a $0 premium on specific plans. National plans1 are typically able to leverage economies of scale to ensure they can continue to offer competitive premiums and benefits. Regional plans, however, typically are not able to weather market pressures as well, such that they may be forced to increase member premiums or reduce benefits if they experience a significant change in their federal revenue.

This white paper examines regional plans’ benefit and premium changes resulting from revenue changes due to Star Rating changes by measuring the change in “value added” through benefits and premium. Show less

Value-based insurance design (VBID) benefits have grown significantly in the Medicare Advantage (MA) market in recent years. The voluntary VBID model for Medicare Advantage Organizations (MAOs) was implemented in 2017, and was recently extended through calendar-year 2030. In this paper, we first summarize our key findings. We then outline benefit trends, the landscape of the 2024 market, and insights for 2025 and beyond. The main sections include the following topics:

-Growth of VBID… Show more

Value-based insurance design (VBID) benefits have grown significantly in the Medicare Advantage (MA) market in recent years. The voluntary VBID model for Medicare Advantage Organizations (MAOs) was implemented in 2017, and was recently extended through calendar-year 2030. In this paper, we first summarize our key findings. We then outline benefit trends, the landscape of the 2024 market, and insights for 2025 and beyond. The main sections include the following topics:

-Growth of VBID participation in recent years
-How food and utilities remain the most common Part C VBID offerings in 2024
-2025 VBID model considerations Show less

This white paper highlights changes in value added and key benefit trends in the MA market from 2023 to 2024. This discussion focuses on dual-eligible special needs plans (D-SNPs), that is, plans that target beneficiaries who are dually eligible for both Medicare and Medicaid.

This white paper highlights changes in value added and key benefit trends in the MA market from 2023 to 2024. This discussion focuses on general enrollment plans (that is, plans that do not target beneficiaries who are dually eligible for both Medicare and Medicaid, have certain chronic conditions, or require an institutional level of care).

Medicare Advantage (MA) plans have expanded in recent years to include new offerings in rural areas. This paper provides insight into the current market for Medicare Advantage, specifically how the landscape differs between rural and urban areas across the country. We highlight key differences in plan offerings in the market today and provide considerations for MA plans when contemplating expansion into rural areas. We first present some background on the program history, funding overview, and… Show more

Medicare Advantage (MA) plans have expanded in recent years to include new offerings in rural areas. This paper provides insight into the current market for Medicare Advantage, specifically how the landscape differs between rural and urban areas across the country. We highlight key differences in plan offerings in the market today and provide considerations for MA plans when contemplating expansion into rural areas. We first present some background on the program history, funding overview, and network adequacy requirements. We then offer analysis on the following:

-MA penetration
-Payment rates
-Plan characteristics and supplemental benefit offerings Show less

In an increasingly competitive Medicare Advantage (MA) marketplace, supplemental benefits are one of the primary ways Medicare Advantage organizations (MAOs) can differentiate their plans from competitors’ plans. A supplemental benefit is an additional benefit MAOs cover for their beneficiaries, but which is not covered under traditional fee-for-service (FFS) Medicare. MAOs offer these benefits to attract Medicare-eligible individuals to their plans. Supplemental benefit coverage can either be… Show more

In an increasingly competitive Medicare Advantage (MA) marketplace, supplemental benefits are one of the primary ways Medicare Advantage organizations (MAOs) can differentiate their plans from competitors’ plans. A supplemental benefit is an additional benefit MAOs cover for their beneficiaries, but which is not covered under traditional fee-for-service (FFS) Medicare. MAOs offer these benefits to attract Medicare-eligible individuals to their plans. Supplemental benefit coverage can either be mandatory, meaning all enrollees in a particular plan receive coverage, or optional, meaning all enrollees in a particular plan can elect to receive coverage for an additional premium. Due to recent Centers for Medicare And Medicaid Services (CMS) demonstration programs and expansions in supplemental benefit flexibilities, MAOs may also limit mandatory supplemental benefits to plan enrollees who meet certain conditions, such as having a diabetes diagnosis. These types of benefits are only offered to a specific subset of a plan’s population, and therefore are not part of this analysis. This analysis focuses on mandatory supplemental benefits offered by Dual Eligible Special Needs Plans (D-SNPs) from 2019 to 2023. Show less

In an increasingly competitive Medicare Advantage (MA) marketplace, supplemental benefits are one of the primary ways Medicare Advantage organizations (MAOs) can differentiate their plans from competitors’ plans. A supplemental benefit is an additional benefit MAOs cover for their beneficiaries, but which is not covered under traditional fee-for-service (FFS) Medicare. MAOs offer these benefits to attract Medicare-eligible individuals to their plans. Supplemental benefit coverage can either be… Show more

In an increasingly competitive Medicare Advantage (MA) marketplace, supplemental benefits are one of the primary ways Medicare Advantage organizations (MAOs) can differentiate their plans from competitors’ plans. A supplemental benefit is an additional benefit MAOs cover for their beneficiaries, but which is not covered under traditional fee-for-service (FFS) Medicare. MAOs offer these benefits to attract Medicare-eligible individuals to their plans. Supplemental benefit coverage can either be mandatory, meaning all enrollees in a particular plan receive coverage, or optional, meaning all enrollees in a particular plan can elect to receive coverage for an additional premium. Due to recent Centers for Medicare and Medicaid Services (CMS) demonstration programs and expansions in supplemental benefit flexibilities MAOs may also limit mandatory supplemental benefits to plan enrollees who meet certain conditions, such as having a diabetes diagnosis. These types of benefits are only offered to specific subsets of a plan’s population, and therefore are not part of this analysis. This analysis focuses on mandatory supplemental benefits offered by general enrollment plans from 2019 to 2023. Show less

In recent years, Medicare Advantage organizations (MAOs) have been adding benefit plans with segments to their portfolios. With these plans, also known as Plan Benefit Packages (PBPs), MAOs aim to take advantage of the ability to segment. For this paper, we reviewed the available information published by the Centers for Medicare and Medicaid Services (CMS), presenting data on the growth of segmented plans, and percentages of MAOs and health maintenance organizations (HMOs) plans that are… Show more

In recent years, Medicare Advantage organizations (MAOs) have been adding benefit plans with segments to their portfolios. With these plans, also known as Plan Benefit Packages (PBPs), MAOs aim to take advantage of the ability to segment. For this paper, we reviewed the available information published by the Centers for Medicare and Medicaid Services (CMS), presenting data on the growth of segmented plans, and percentages of MAOs and health maintenance organizations (HMOs) plans that are segmented. In this paper, we discuss:

-A market summary
-Why an MAO would consider implementing segmentation
-Mechanics of plan segmentation
-Requirements for the bid process Show less

The 2023 benefit landscape in the Medicare Advantage (MA) market includes an increase in the number of beneficiaries covered by plans offering combined benefits up to a maximum amount—known as a combined benefit limit, or “combo” benefit. Using Milliman MACVAT®, a tool providing a comprehensive benefit summary of individual MA plans, we analyzed 2023 plans to determine the breadth of combo offerings available. This article provides a summary of 2023 combo benefits in the comprehensive… Show more

The 2023 benefit landscape in the Medicare Advantage (MA) market includes an increase in the number of beneficiaries covered by plans offering combined benefits up to a maximum amount—known as a combined benefit limit, or “combo” benefit. Using Milliman MACVAT®, a tool providing a comprehensive benefit summary of individual MA plans, we analyzed 2023 plans to determine the breadth of combo offerings available. This article provides a summary of 2023 combo benefits in the comprehensive nationwide MA market. With respect to combined benefit packages, the article discusses:

-Overall coverage
-Benefit prevalence
-Considerations for bid strategies Show less

Optional supplemental benefits (OSBs) are benefits that are not covered by original Medicare and which Medicare Advantage organizations (MAOs) offer to plan members for an additional premium. If offered, members can elect to purchase OSB coverage from their Medicare Advantage (MA) plans and receive additional benefits. This differs from mandatory supplemental benefits (MSBs), which are benefits not covered by original Medicare that MAOs can choose to provide for all members who enroll in their… Show more

Optional supplemental benefits (OSBs) are benefits that are not covered by original Medicare and which Medicare Advantage organizations (MAOs) offer to plan members for an additional premium. If offered, members can elect to purchase OSB coverage from their Medicare Advantage (MA) plans and receive additional benefits. This differs from mandatory supplemental benefits (MSBs), which are benefits not covered by original Medicare that MAOs can choose to provide for all members who enroll in their plans, with no additional premium attached. MAOs can offer multiple OSB package options to members, and multiple supplemental benefits can be bundled together under each package. According to Milliman’s analysis of publicly available data, over 30% of all MA plans in 2021 offered at least one OSB package.

This paper discusses OSBs offered by MAOs in general enrollment plans from 2017 to 2021. A very small proportion of special needs plans (SNPs) offered OSBs—about 7% of all SNPs in 2021—and we excluded them from this analysis. We examine the prevalence of OSBs by plan type, MAO size, and benefits included. Additionally, we examine trends in premium for members who elect to purchase OSB coverage. Show less

The 21st Century Cures Act (Cures Act), which passed in December 2016 and came into effect January 1, 2021, requires Medicare Advantage (MA) plans to allow active enrollment of beneficiaries with end-stage renal disease (ESRD) in their plans. This paper focuses on the various changes to MA plans made in reaction to an expected increase in ESRD enrollment due to the Cures Act, taking advantage of new Centers for Medicare and Medicaid Services (CMS) flexibilities. We compared various plan… Show more

The 21st Century Cures Act (Cures Act), which passed in December 2016 and came into effect January 1, 2021, requires Medicare Advantage (MA) plans to allow active enrollment of beneficiaries with end-stage renal disease (ESRD) in their plans. This paper focuses on the various changes to MA plans made in reaction to an expected increase in ESRD enrollment due to the Cures Act, taking advantage of new Centers for Medicare and Medicaid Services (CMS) flexibilities. We compared various plan characteristics in 2019, 2020, and 2021 to infer market reaction to the law. The paper also discusses models started by the Centers for Medicare and Medicaid Innovation (CMMI) to address some of the cost issues inherent in providing care to ESRD beneficiaries. Show less

The COVID-19 pandemic was a catalyst for telehealth benefit expansion in the Medicare Advantage (MA) market. Within the highly competitive telehealth landscape for 2021, there are many different levels of benefit offerings. As a result, MA organizations are left to wonder how to best frame their telehealth benefit going forward.

This analysis focuses on mandatory supplemental benefits offered by Dual Eligible Special Needs Plans (D-SNPs) from 2017 to 2021. Because D-SNPs cannot attract members by enhancing Medicare-covered benefits or reducing member premium, supplemental benefits are the key distinguishing plan design in the D-SNP market.

This article focuses on mandatory supplemental benefits offered by general enrollment Medicare Advantage plans from 2017 to 2021. Plans with vision, hearing, and dental benefits include an increasing percentage of members from 2017 to 2021.

Medicare Advantage organizations (MAOs) can have widely different responses to changes in revenue due to changes in star rating. Many MAOs are confined by competitive pressures in their market, and are unable or reluctant to make large benefit changes or premium changes in a single year. This paper provides insight into benefit and premium changes made alongside revenue changing due to a star rating change and measures the change in value added through benefits and premium changes provided to… Show more

Medicare Advantage organizations (MAOs) can have widely different responses to changes in revenue due to changes in star rating. Many MAOs are confined by competitive pressures in their market, and are unable or reluctant to make large benefit changes or premium changes in a single year. This paper provides insight into benefit and premium changes made alongside revenue changing due to a star rating change and measures the change in value added through benefits and premium changes provided to beneficiaries. Show less

This report highlights key changes in member premiums and benefits for the 2020 Medicare Advantage (MA) market, as well as the contributing factors for, and the magnitude of, the increase in value added within the MA market each year from 2016 to 2020. It also aims to assist Medicare Advantage organizations in making strategic decisions during 2021 bid preparations.

Over the last few years, Medicare Advantage organizations (MAOs) have been adding plans with segments to their plan portfolios in order to take advantage of a number of benefits of plan segmentation. These plans are known as plan benefit packages (PBPs). There are numerous advantages to segmenting a plan within an MAO’s portfolio of PBPs, relative to the alternative of offering separate PBPs to achieve strategic objectives.

Enrollment affects a Medicare Advantage organization’s (MAO) revenue and profitability and is a key driver to becoming successful. Enrollment projections are a critical component of a new MAO’s financial pro forma. This paper analyzes historical enrollment experience for parent organizations new to the Medicare Advantage market from 2007 to 2018.

For plans offered in 2019, Medicare Advantage organizations were allowed to provide access to particular benefits for members with certain disease states under what is known as the Uniformity Flexibility (UF) benefit option. This paper reviews the UF benefits offered during the contract year 2019 plan year to provide insight into the market dynamics regarding this new benefit design.

Each Medicare Advantage (MA) plan has an associated “value added,” defined as the value of benefits provided to a specific plan’s beneficiaries above traditional Medicare that are not funded through member premiums. This report highlights key changes in beneficiary premiums and benefits for the 2018 MA market as well as the reasons for and the magnitude of the decrease in value added within the MA market between 2014 and 2016 and the increases in value added in 2017 and 2018. The report also… Show more

Each Medicare Advantage (MA) plan has an associated “value added,” defined as the value of benefits provided to a specific plan’s beneficiaries above traditional Medicare that are not funded through member premiums. This report highlights key changes in beneficiary premiums and benefits for the 2018 MA market as well as the reasons for and the magnitude of the decrease in value added within the MA market between 2014 and 2016 and the increases in value added in 2017 and 2018. The report also aims to assist Medicare Advantage organizations in making strategic decisions during 2019 bid preparations. Show less

Successful Medicare Advantage organizations maximize federal revenue to provide enhanced benefits and/or reduced premiums to their members, which ultimately improves marketability with the aim of increasing membership. Organizations entering the Medicare Advantage market should be aware of the current star rating climate as well as short- and long-term star rating and revenue considerations.

The Medicare Payment Advisory Commission (MedPAC) proposed several changes to the Medicare Part D program in a June 2016 report. MedPAC advises Congress on policies related to Medicare and its recommendations could potentially be enacted by Congress. This paper discusses the impact that MedPAC’s proposed changes could have on plan sponsors, Part D members, and pharmaceutical manufacturers.

The passage of the Patient Protection and Affordable Care Act had a significant impact on the health insurance market in the United States, thereby reducing Medicare advantage benchmark rates. This reduction begs the question, "How much have Medicare Advantage Organizations earned back through quality bonus payments?"

The reduction began in 2012 and occurred over a two-, four- or six-year time frame, depending on the size of the reduction. Thus, today's 2016 benchmark payment rates… Show more

The passage of the Patient Protection and Affordable Care Act had a significant impact on the health insurance market in the United States, thereby reducing Medicare advantage benchmark rates. This reduction begs the question, "How much have Medicare Advantage Organizations earned back through quality bonus payments?"

The reduction began in 2012 and occurred over a two-, four- or six-year time frame, depending on the size of the reduction. Thus, today's 2016 benchmark payment rates include a reduction that is either fully phased in ... or five-sixths phased in. As of 2017, the reductions will be fully phased in, and in 2018 and beyond, annual benchmark payment rates are scheduled to trend at the same rate as expected Medicare cost. Show less

This report highlights key changes in beneficiary premiums and benefits for the 2016 Medicare Advantage (MA) market as well as the reasons for and the magnitude of the decrease of value add within the MA market between 2013 and 2016 with a more detailed look at changes between 2015 and 2016. It also summarizes the components of the Patient Protection and Affordable Care Act (ACA) and subsequent legislated actions driving the downward payments to Medicare Advantage organizations (MAOs). This… Show more

This report highlights key changes in beneficiary premiums and benefits for the 2016 Medicare Advantage (MA) market as well as the reasons for and the magnitude of the decrease of value add within the MA market between 2013 and 2016 with a more detailed look at changes between 2015 and 2016. It also summarizes the components of the Patient Protection and Affordable Care Act (ACA) and subsequent legislated actions driving the downward payments to Medicare Advantage organizations (MAOs). This report also aims to assist MAOs in making strategic decisions during 2017 bid preparations. Show less

The Centers for Medicare and Medicaid Services (CMS) requires all Medicare Advantage organizations (MAOs) to submit a bid by the first Monday in June that estimates the cost to provide traditional Medicare benefits to an “average risk” Medicare beneficiary for the coming year. A portion of any savings generated by the MAO (the savings defined as the difference between the bid and the benchmark rate) is returned to the plan as a rebate, which can be used by the plans to provide benefits above… Show more

The Centers for Medicare and Medicaid Services (CMS) requires all Medicare Advantage organizations (MAOs) to submit a bid by the first Monday in June that estimates the cost to provide traditional Medicare benefits to an “average risk” Medicare beneficiary for the coming year. A portion of any savings generated by the MAO (the savings defined as the difference between the bid and the benchmark rate) is returned to the plan as a rebate, which can be used by the plans to provide benefits above and beyond traditional Medicare.

As MAOs prepare to submit these bids each year, they must take into account historical costs, CMS revenue levels, anticipated market changes, and membership characteristics, which all impact how a plan’s costs and benefits will change in the coming year. As the Medicare Advantage (MA) market continues to evolve through the Patient Protection and Affordable Care Act (ACA), it is important to analyze how the landscape of this program is changing in the coming year.

This report highlights key changes in beneficiary premiums and benefits for the 2014 MA market and aims to assist MAOs in making strategic decisions during 2015 bid preparations Show less

One of the notable revenue provisions included in the Patient Protection and Affordable Care Act (ACA) is an excise tax on the health insurance industry that will be assessed annually starting in 2014. This report provides an independent analysis of the impact of the ACA health insurer fee provision on the United States health insurance industry.