Rumor has it that CI wants to shed its MA business. Like all rumors this one is not specific enough to tell us if a divestiture would include the PDP business but we would not be surprised. As we have previously pointed out, in 2024-25, CMS will be phasing in a new benefit design that eliminates the moral hazard of Medicare's 80% contribution to drug purchases made in the catastrophic phase of the benefit (over $3,100 in beneficiary out-of-pocket). In 2024, plan sponsor's share in the catastrophic phase will increase from 15% to 20%. In 2025, plans assume responsibility for 60%. Drug manufacturers take on 20% and the balance is Medicare's liability.
The shift in liability requires the plan sponsors to be more aware of their drug spend, something that is more difficult with stand alone PDPs paired with traditional Medicare as compared to a MA+PDP plan. We have seen a dramatic shift away from enrolling PDP members at HUM and, to a lesser degree, at UNH.
CI has never been a stand out selling MA+PDP plans. It strength is commercial offerings and the ESRX PBM. With Blues plans facing headwinds, post anti-trust litigation and the elimination of gag orders between self-insurer plans and vendors, the landscape offers new opportunities in the Employer-sponsored area we have probably never seen before.
Let me know what you think.
Link to talk more here.
Emily Evans
Managing Director – Health Policy
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