Cigna is making significant changes to its Medicare Advantage (MA) plan offerings across eight states, which will affect thousands of beneficiaries. These adjustments have led to the termination of certain plans and services, forcing some members to explore alternative options. The majority of these plan cuts will impact its Florida membership, with as many as 5,395 beneficiaries being required to find new plans.
Cigna’s Medicare Advantage Plan Changes
Cigna’s recent announcement outlines its decision to make reductions across 36 Medicare Advantage health plans, affecting several states. The move, aimed at optimizing services and ensuring sustainable network adequacy, is expected to hit Florida the hardest, particularly in terms of membership.
The States Affected by Cigna’s Plan Reductions
The eight states experiencing changes include:
– Colorado
– Florida
– Illinois
– Missouri
– North Carolina
– Tennessee
– Texas
– Utah
Members across these states will see various adjustments to their current plans, with exiting specific counties altogether in some cases.
Impacts on Florida Medicare Advantage Members
Of the 5,395 beneficiaries impacted, 4,000 reside in Florida, making it the state most affected by these changes. Cigna has decided to stop offering PPO plans in Florida and certain counties in two other states. While alternatives will be provided for most counties, Missouri and North Carolina will see full exits from select counties. For members in these areas, this means transitioning to new plans or providers.
Reasons Behind the Plan Changes
Cigna’s Service Area Evaluation
According to the announcement posted on Pinnacle Financial Services’ website, Cigna undergoes an annual evaluation of its Medicare Advantage service areas. This includes a review of network adequacy, provider engagement, and service area viability. If gaps are found in any of these areas that cannot be resolved, it leads to service reductions or the non-renewal of plans.
The Role of Network Adequacy and Provider Engagement
Network adequacy is crucial to ensuring that members have access to quality healthcare providers within a reasonable distance. If it determines that provider engagement or network adequacy cannot be sufficiently maintained in certain areas, the company may decide to scale back or withdraw from those markets.
Impact on Cigna’s Business
The reduction of Medicare Advantage plans is part of a broader realignment of Cigna’s Medicare business. Earlier this year, It agreed to sell its Medicare Advantage and related businesses to Health Care Service Corp (HCSC).
Sale of Medicare Business to Health Care Service Corp (HCSC)
In January 2024, Cigna finalized a deal to sell its Medicare business to HCSC for $3.7 billion. This deal included not only Medicare Advantage plans but also Medicare Part D, supplemental benefits, and CareAllies, a Cigna healthcare service subsidiary. HCSC now owns these businesses, further reducing its involvement in the Medicare market.
Partnership with Evernorth for Pharmacy Services
Despite exiting parts of its Medicare business, Cigna has retained ties with its subsidiary Evernorth. Evernorth will continue providing pharmacy services for HCSC’s Medicare plans, ensuring continuity of care for beneficiaries who require medication management and other related services.
Other Insurers Making Similar Adjustments
Cigna isn’t the only major insurance company reducing its Medicare Advantage offerings. Regulatory pressures and high utilization rates are leading several large insurers to make similar adjustments.
Humana’s Exit from 13 Markets
Humana, one of the nation’s largest Medicare Advantage providers, has announced that it will exit 13 markets next year. This move is expected to affect 10% of Humana’s Medicare Advantage membership, showcasing the broader trend of insurers adapting to market pressures and regulatory changes.
Regulatory Pressures on Medicare Advantage Plans
Regulatory changes and market demands are increasing the strain on insurers offering Medicare Advantage plans. As companies face rising costs and growing regulatory scrutiny, they are being forced to reconsider their coverage areas, leading to reduced service offerings in specific regions.
FAQs
1. What states are affected by Cigna’s Medicare Advantage plan reductions?
A. The eight states impacted by Cigna’s Medicare Advantage plan reductions include Colorado, Florida, Illinois, Missouri, North Carolina, Tennessee, Texas, and Utah.
2. How many beneficiaries will be impacted by Cigna’s plan reductions?
A. A total of 5,395 beneficiaries will be affected, with 4,000 of them residing in Florida.
3. Why is Cigna cutting Medicare Advantage plans?
A. Cigna’s decision to reduce Medicare Advantage plans is based on an annual evaluation of service area viability, network adequacy, and provider engagement. If gaps in these areas cannot be resolved, plans may be reduced or not renewed.
Conclusion
Cigna’s decision to trim its Medicare Advantage offerings in eight states reflects the broader challenges facing the insurance industry today. With rising regulatory pressures, network adequacy issues, and a shifting market landscape, Cigna and other insurers are being forced to reevaluate their offerings. While the majority of affected beneficiaries will have access to alternative plans, some will need to explore new coverage options in counties where it has exited entirely.
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