June 4, 2019
According to Mark Farrah Associates’ Health
Coverage PortalTM, outsourced services include expenses for
administrative services, Electronic Data Processing (EDP), and membership
services that are contracted out to a third party or vendor. For NAIC (National
Association of Insurance Commissioners) reporting health insurance companies,
annual outsourced service spending increased by 24% from $11.3 billion in 2016
to $14.0 billion in 2018. Accordingly, outsourced service spending trends show
progressive expenditures across the top 5 health plans, measured by outsourced service
spending.
HCSC and Humana consistently spent over $1
billion annually on outsourced services, with $3.745 billion and $3.699 billion
expended respectively over the three-year period. Centene saw the largest
actual increase in spending by over $498 million over the three-year period.
Horizon BCBS of NJ experienced the largest percentage gain between 2016 and
2017, more than doubling outsourced service spending, with $0.643 billion spent
in 2018.
Please note: California managed care plans do
not file financial statements with the NAIC and are not included in this
analysis. In addition to CA HMO's, life, property, and fraternal plans do
not file this information for their health business for the NAIC. For
more information about Health Coverage
Portal, please visit our website or call 724.338.4100.
About Mark Farrah Associates (MFA)
Mark Farrah Associates (MFA) is a leading data
aggregator and publisher providing health plan market data and analysis tools
for the healthcare industry. Our product portfolio includes Health Coverage Portal™, County Health Coverage™, Medicare Business Online™, Medicare
Benefits Analyzer™, and Health Plans USA™. For more information
about these products, refer to the informational videos and brochures available
under the Our Products section of the website or call 724-338-4100.
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