Centene CEO Sarah London has stated that behavioral healthcare costs are rising due to increased demand, while emergency room visits among Medicaid enrollees are declining. Insurers like Humana and UnitedHealthcare warn of mounting cost pressures from drug shortages, higher pharmaceutical costs, and increased service utilization post-pandemic. They anticipate medical loss ratios to be at the high end of projected ranges for the year.
Behavioral health costs are experiencing a significant increase, according to Sarah London, the CEO of Centene. In an interview with Bloomberg TV on June 27, Ms. London highlighted that behavioral healthcare services are among the fastest-growing areas in terms of expenses.
Ms. London explained that the rise in costs can be attributed, in part, to an increased demand for these services. However, she also noted a decline in emergency room visits among Medicaid enrollees, which has contributed to cost savings.
She stated, “Within the Medicaid population, we have observed a decrease in emergency department visits. This decline can be partially attributed to the fact that historically, adult Medicaid beneficiaries have sought primary care in the emergency room. By redirecting and reconnecting them to more convenient primary care locations, we have adopted a more cost-effective and high-quality approach to healthcare provision.”
In recent times, major insurers have expressed concerns about mounting cost pressures stemming from various factors. These include drug shortages, rising pharmaceutical expenses, and higher utilization of services in the post-pandemic period.
Both Humana and UnitedHealthcare have cautioned that they anticipate their medical loss ratios to be at the upper end of the projected range for the entire year.
