Administrative Cost Trends of Medicare-Focused Plans in 2022
Medicare-Focused plans experienced a 1.9% increase in administrative expenses from 2021 to 2022 compared with a 0.6% increase in the prior year. The largest cluster of functions, Account and Membership Administration, increased by 3.7%, shown in Figure 1. This is a more modest growth than reported by the Blue Cross Blue Shield and Independent / Provider – Sponsored universes despite Sales and Marketing growth being faster.
Eleven plans participated in the 2023 edition of the Medicare Sherlock Benchmarks, reflecting 2022 results. The participating plans collectively served 1.7 million Medicare Advantage members. These single state or regional plans served 16.4% of Medicare Advantage not served by the five largest share plans. An average of 30% of revenues of these companies were in Medicare Advantage and Medicare SNP (“Special Needs Plans”) products, exceeded 20% of revenues in all cases, and was the plurality product in several cases. Eight plans participated in both the 2022 and 2021 benchmarking cycles and these were used for trend purposes.
This analysis is based on the twentieth annual edition of our performance benchmarks for Medicare-focused health plans. The Sherlock Benchmarks (Sherlock Expense Evaluation Report or SEER) represent the cumulative experience of approximately 1,000 health benefit organization years.
Event Date: Wednesday, September 13, 2023Speaker
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