Being Competitive with MA plans

*midwestbroker* · 07-31-2007, 10:39 PM

The overall process of designing a competitive MA plan is amazing to me.

You have carriers who submit their plans to CMS midyear for the following year. They have no idea what the competition is doing. Are they lowering their co-pays, upping their premium, etc. No one knows but the carrier designing the plan.

October 1st is when the plans are released to the public. That is when all the carriers know how competitive they are. If they are not competitive, they are dead in the water for a year.

CMS used to allow for midyear changes as long as the benefits were an improvement. Now carriers have to wait until the following year.

It just amazes me that they all have to basically throw their plans on the wall and pray it sticks.

wilkin · 08-01-2007, 08:00 AM

I'm not convinced that all carriers are completely in the dark as to what their competition is planning. I believe information gets leaked or is casually shared at the executive level. These folks belong to the same clubs, see each other at meetings, etc. and I'm certain they talk shop.

Frank Stastny · 08-01-2007, 08:22 AM

Originally Posted by midwestbroker

The overall process of designing a competitive MA plan is amazing to me.

You have carriers who submit their plans to CMS midyear for the following year. They have no idea what the competition is doing. Are they lowering their co-pays, upping their premium, etc. No one knows but the carrier designing the plan.

October 1st is when the plans are released to the public. That is when all the carriers know how competitive they are. If they are not competitive, they are dead in the water for a year.

CMS used to allow for midyear changes as long as the benefits were an improvement. Now carriers have to wait until the following year.

It just amazes me that they all have to basically throw their plans on the wall and pray it sticks.

Me too.

It's like they are putting PFFS plans "out for bid".

The Federal Government puts out bids on everything, and it is always the lowest bidder that gets the contract. It's like the cartoon of the astronauts sitting in their chairs waiting for blast off and one says to the other, "do you realize that the lowest bidder built this thing?"

"Bidding" can be a good thing but I'm not too sure it is in the best interest of people when it comes to healthcare. Personally, I would want the "best" plan, not the "cheapest" most confusing one.

They standardized Med Supp policies in 1992 because they discovered that insurance companies were not doing a good job of designing policies to supplement Medicare. I think it works extremely well with Medicare Supplement plans, why not do the same with PFFS plans?

*midwestbroker* · 08-01-2007, 09:49 AM

That may be the case in PFFS markets, but in a local setting, I think they do what they can to keep the competition guessing. Humana and Coventry will design the plans at a local level.

Example: In Kansas City, Coventry came out with a PPO that was, for the most part, better then Humana's for 2007. We had no idea until late September, when it was too late to do anything about it.