The market share of Medicaid health plans remained fairly constant between 2018 and 2019. In 2019, the national health insuring organizations with the largest number of Medicaid health plan lives including primary and acute care were Centene, Anthem, UnitedHealthcare, WellCare, and Molina. These insurers serve approximately 26.6 million individuals and represent 50.1% of the population enrolled in Medicaid managed care. Additionally, these insurers represent 36.5% of the total Medicaid population, according to our new analysis published in The 2020 OPEN MINDS Medicaid Managed Care Market Share Report.
Compared with 2018, the five health insurance organizations with the largest Medicaid populations remained the same although enrollment numbers have changed. In that time period, the total enrollment among the top five insurers dropped 1% and market share increased by 3.3%. Centene and Anthem’s enrollment increased slightly while UnitedHealthcare and Molina saw decreases in enrollment. Molina’s drop in enrollment can likely be attributed to the end of its Medicaid contract in New Mexico. UnitedHealthcare’s loss is likely due to the end of its contracts in Iowa and New Mexico (see UnitedHealthcare Is Pulling Out Of Iowa’s Private Medicaid Management Program and New Mexico Awards Medicaid Managed Care Contracts To Two Incumbents & One Newcomer).
These are important developments for organizations serving consumers with complex needs who are heavily represented in the Medicaid numbers. As we reported last week, Medicaid managed care now covers 73% of Medicaid beneficiaries (see Medicaid Managed Care—Taking The Bill Gates Perspective).
The most significant change in the Medicaid health plan landscape is the pending merger of Centene and Wellcare. Just this week, the deal was finally and officially approved (see Centene-Wellcare Megamerger Closes). Combined, the organizations will have 21% of Medicaid managed care market share.
For executives of provider organizations that have contracts with Centene or Wellcare (whether Medicaid, Medicare, or commercial), the pending merger raises significant strategic questions. First, there is likely to be significant turnover in the new organization, as is typical with every merger. Second, there is “the map.” In how many states do Centene and Wellcare both operate Medicaid health plans? The answer is nine states, which are listed in The 2020 OPEN MINDS Medicaid Managed Care Market Share Report. In these states, the unknown is whether and how the plans will be combined. There are implications for referrals, rates, clinical criteria, and value-based/preferred provider relationships. In the states where there are not duplicate Medicaid health plans, the question will be what changes in policy and practice at the national level will affect the state-specific Medicaid health plans?
For executive teams of organizations with significant revenue from either a Centene or Wellcare health plan, this is a time to “hurry up and wait.” The immediate part is to learn as much as you can about both organizations at the national and local levels. Create an influence map of key national and local staff and develop a plan for building awareness of your organization and its programs—and (if possible) relationships. And build your market intelligence on staffing changes, new contracts, contract losses, and any announcements of reorganizations. With that, executives need to be prepared to act when any opportunity presented by the change happens. Being nimble is required!
For more on responding to changing markets, check out these OPEN MINDS resources:
- It Takes Courage
- How Many Strategies Actually Get Implemented?
- Are You A Change Agent Leader? Take The Test
- Adjust Your Strategic Sails!
- Who Do You Need To Lead An Agile Organization?
- For ‘Agile’ Organizations, Change Management IS Performance Management
- Anticipating The Looming Strategic Surprises
- Building A Value-Based Sustainability Strategy: How To Develop Innovative Programs & Manage Your Service Line Portfolio
- A Deep Dive To Maintain Your Market Edge
- Negotiate Those Contracts
For an in-depth view of the Medicaid managed care market, check out our latest report The 2020 OPEN MINDS Medicaid Managed Care Market Share Report, which we have outlined here. And for even more, join us February 12 at The 2020 OPEN MINDS Performance Management Institute in Clearwater, Florida for “How To Build Value-Based Payer Partnerships: An OPEN MINDS Executive Seminar On Best Practices In Marketing, Negotiating & Contracting With Health Plans.”