Centene expects to lose about 2.2 million Medicaid members during redefinition over the next 18 months, which will significantly affect the insurer’s pandemic-era growth.
The company on Tuesday reported nearly 16 million Medicaid members by the end of 2022, including about 3 million members it has reached since the start of the pandemic. Chief Executive Officer Sarah London told analysts during the company’s fourth-quarter earnings call on Tuesday, estimating products in its marketplace will gain 200,000 and 300,000 lives in redefining. .
“A lot of it is due to the belief that the vast majority of redefining members will first go into commercial operation,” London said. “We just need to see how the data starts to play out and if there are any adjustments to that as we see people looking to products in the market.”
Before states can begin de-registering people who are not eligible for Medicaid starting April 1, Centene has been working with state and community partners to make it easier, she said. convenient for member transition and continuous insurance. Centene is also prioritizing member access for those potentially eligible for Medicaid and tracking redetermination-related activity through member dashboards and reports.
For the fourth quarter, Centene said it lost $213 million, or 38 cents a share, compared with a year-ago profit of $599 million, or $1.01 a share. Total revenue came in at $35.6 billion, up from $32.6 billion.
For the year, Centene recorded a profit of $1.2 billion, or $2.07 a year, compared with $1.3 billion, or $2.28 a share in 2021.
Annual revenue grew 15% to $144.5 billion, from $126 billion in 2021. This increase was largely due to a spike in Medicaid and Medicare membership, as well as Centene’s acquisition of Magellan in January 2022, London said.
The company ended 2022 with 21% more Medicare Advantage members than it did in 2021.
Centene predicts it will cost when taking into account Medicare Advantage losses in 2024 due to poor star scores. Several insurer ratings have dropped this year due to higher ratings of consumer experience surveys, stricter enforcement of standards before the pandemic, and cancellations of subscriptions.
“We are certainly pricing in negative returns in Medicare Advantage temporarily in 2024, and we don’t expect to develop Medicare Advantage by 2024 and potentially have it,” Chief Financial Officer Drew Asher said on the call. it will decrease a little bit.”
Since the preliminary rates for Medicare Advantage plans in 2024 are “less favorable than in recent years,” says London, Centene intends to provide feedback to the Centers for Medicare and Medicaid Services in favor of the move. increase the show’s revenue even more, London said.
Over the past year, Centene has reduced its real estate by 70% and sold many businesses.
In January, it completed the sale of Magellan Specialty Health for more than $600 million in cash and stock; Centurion, its prison healthcare business; and HealthSmart, a third-party health plan management business.
