Lexology February 26, 2020
In its 2021 Proposed Rule for the Medicare Advantage program, the Centers for Medicare & Medicaid Services (CMS) proposes to alter the rules under which Medicare Advantage Organizations (MAOs) may obtain reinsurance. The changes would provide more flexibility to MAOs seeking to obtain reinsurance but also are likely to disappoint some plans that want to make a broader use of reinsurance.
MAOs, like other health insurers, often seek to obtain reinsurance for a variety of reasons. For small MAOs, a larger-than-expected number of extremely high-cost enrollees can cause substantial losses for the plan. Small MAOs cannot absorb such losses in the same manner as national MAOs. Reinsurance is therefore a key means of limiting financial risk for small MAOs. In...
Today's Sponsors
Today's Sponsor