Fitch: Growth in Medicaid Expansion Depends on States, Political Climate

CHICAGO--(BUSINESS WIRE)-- Link to Fitch Ratings' Report: Medicaid Expansion (Underwriting Margins Maintained)https://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=877723

The Medicaid expansion provision in the Affordable Care Act (ACA) drove 31% growth in health insurance industry Medicare revenues in 2014, outpacing the 18% five year average between 2010 and 2014, according to a Fitch Ratings report Medicaid Expansion - Underwriting Margins Maintained. Future growth in industry Medicaid revenue will depend on states opting in or out of Medicaid expansion, which will largely be determined by the U.S. political climate after the 2016 presidential election.

'The Medicaid business is modestly profitable and experiences low volatility and historically has been less profitable than Medicare, however with Medicaid expansion and reimbursement reductions under the Affordable Care Act, Medicare and Medicaid are starting to achieve profit parity,' said Doug Pawlowski, Senior Director, Fitch Ratings.

Currently 30 states participate in Medicaid expansion, which under the ACA extended Medicaid eligibility to all U.S. citizen and legal residents with income up to 133% of the poverty line, including adults without dependent children.

The five largest Medicaid insurers measured by net written premium: UnitedHealth Group (UNH), Anthem Inc. (Anthem), Centene, Molina Healthcare (Molina), and WellCare Health Plans Inc. (WellCare), accounted for nearly one-half of the greater than $115 billion in total Medicaid premiums written in 2014. Despite modest industry margins for the Medicaid business, four of the five largest Medicaid writers reported better than industry average Medicaid underwriting margins over the most recent five-year period, according to Fitch.

The Medicaid Expansion special report is available on Fitch's website at 'www.fitchratings.com' or by clicking on the link.

Additional information is available at 'www.fitchratings.com'.

ALL FITCH CREDIT RATINGS ARE SUBJECT TO CERTAIN LIMITATIONS AND DISCLAIMERS. PLEASE READ THESE LIMITATIONS AND DISCLAIMERS BY FOLLOWING THIS LINK: HTTP://FITCHRATINGS.COM/UNDERSTANDINGCREDITRATINGS. IN ADDITION, RATING DEFINITIONS AND THE TERMS OF USE OF SUCH RATINGS ARE AVAILABLE ON THE AGENCY'S PUBLIC WEBSITE 'WWW.FITCHRATINGS.COM'. PUBLISHED RATINGS, CRITERIA AND METHODOLOGIES ARE AVAILABLE FROM THIS SITE AT ALL TIMES. FITCH'S CODE OF CONDUCT, CONFIDENTIALITY, CONFLICTS OF INTEREST, AFFILIATE FIREWALL, COMPLIANCE AND OTHER RELEVANT POLICIES AND PROCEDURES ARE ALSO AVAILABLE FROM THE 'CODE OF CONDUCT' SECTION OF THIS SITE. FITCH MAY HAVE PROVIDED ANOTHER PERMISSIBLE SERVICE TO THE RATED ENTITY OR ITS RELATED THIRD PARTIES. DETAILS OF THIS SERVICE FOR RATINGS FOR WHICH THE LEAD ANALYST IS BASED IN AN EU-REGISTERED ENTITY CAN BE FOUND ON THE ENTITY SUMMARY PAGE FOR THIS ISSUER ON THE FITCH WEBSITE.

View source version on businesswire.com: http://www.businesswire.com/news/home/20160224006631/en/

Fitch Ratings
Douglas M. Pawlowski, CFA
Senior Director
+1-312-368-2054
Fitch Ratings, Inc.
70 W. Madison Street
Chicago, IL 60602
or
Douglas Baker
Associate Director
+1-312-368-3207
or
Media Relations
Hannah James, + 1-646-582-4947
[email protected]

Source: Fitch Ratings

---

Serious News for Serious Traders! Try StreetInsider.com Premium Free!

---

You May Also Be Interested In

• Sheila Busheri Scholarship Announces New Opportunity for Undergraduate Students Pursuing Medical Careers
• Dr. Jacqueline Youtsos Launches National Scholarship to Cultivate Compassionate Future Physicians
• Andrew Hillman National Scholarship Launches to Fuel Next-Gen Business Leaders