CVS Health’s Aetna health insurance business
has an aggressive plan to woo more eligible Medicare beneficiaries in 2020 to
increasingly popular Medicare Advantage plans.
Aetna's Medicare Advantage membership is up
more than 400,000 enrollees this year to 2.2 million as of the end of the
second quarter compared to the end of 2018 when the company reported 1.75
million Medicare Advantage members.
This fall will be the first open enrollment
period with Aetna and CVS as a combined company following its merger late last
year and executives are ramping up their effort to reach more seniors with 2020
Medicare Advantage benefit packages during what may be the most competitive
market in years among insurers. “We'll provide coverage access to about 80% of
Medicare eligible lives,” CVS Health chief executive Larry Merlo told analysts
on the company’s second quarter earnings call Wednesday.
CVS and Aetna executives are enticing seniors
for 2020 enrollment in Medicare Advantage plans with new benefits that will
feature “zero” co-payments for treatments and services at their more than 1,100
MinuteClinics staffed by nurse practitioners. The health insurer is also
planning to integrate more health services at new “Health Hub” location stores
that CVS is rolling out over the next three years.
Aetna’s expansion into new Medicare Advantage
regions is the latest by health insurance companies that sell such plans, which
contract with the federal government to provide extra benefits and services to
seniors, such as disease management and nurse help hotlines with some also
offering vision, dental care and wellness programs.
There’s also a financial benefit to health
plans for enrolling seniors in Medicare Advantage plans. A new report out this week from the
Kaiser Family Foundation showed “annual gross margins in the
Medicare Advantage market averaged $1,608 per covered person between 2016 and
2018, about double the margins in the individual and group markets.”
Several health plans, including Anthem,
Centene, Humana and UnitedHealth Group are looking to expand their Medicare
Advantage businesses next year and beyond as well. And now insurers are rolling
out more supplemental benefits in their Medicare Advantage plans following rule
changes implemented.
“Relative to our 2020 bid, we took a very
balanced approach to 2020,” Karen Lynch, executive vice president of CVS Health and
president of the Aetna business unit told analysts Wednesday. “Our
go-to-market strategy included a broad portfolio of remaining at zero premium
PPO and HMO plans, we feel good of our ability to further build plans. We also
were able to offer new supplemental benefits and we are also able to leverage
the enterprise MinuteClinics by offering zero co-pay or lower co-pays at
MinuteClinics.”
Given the CVS Caremark pharmacy benefit
manger’s sizable business providing Medicare Part D prescription drug plans,
executives said they are also going to be aggressive about marketing Medicare
Advantage plans to those customers already enrolled in the company’s Part D
prescription benefits.
As health plans integrate PBMs into their
medical plans, these larger companies are melding prescription and health plan
benefit packages to individuals, employers and government health programs.
UnitedHealth owns the OptumRx PBM, Cigna bought the Express Scripts PBM last
year and Anthem is rolling out its own PBM, IngenioRx.
“We see opportunities to accelerate PDP to MA
conversions to provide our members,” Merlo said.
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