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In Minn., Medicaid managed care looking at big losses

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In what might be national trend, managing care for lower-income Minnesotans has become unprofitable this year.

One insurer asserts that that low payment rates from the state this year have overcorrected the big profits of 2015.

Through the first three quarters of 2016, the  Medicaid HMO divisions at  Medica and Blue Cross and Blue Shield of Minnesota posted a combined loss of about $195 million.

The Minneapolis Star Tribune said that Medica and Blue Cross were “the big winners in terms of enrollment when the state dramatically downsized Minneapolis-based UCare’s position for 2016 as a managed care organization in the largest chunk of state public programs.”

Last year, insurers in Minnesota and other states saw lots of operating income from the Medicaid business,  aided by the flood of low-income enrollees as a result of the Affordable Care Act.

“The market greatly overcorrected, which is creating the situation where we have the losses that we do,” said Geoff Bartsh, the vice president and general manager for state public programs at Medica, told the Star Tribune. “The payments to the plans from the state are nowhere near adequate to cover the costs of the program.”

Will we see a lot of similar stuff as year-end reports come in?

To read the Star Tribune’s report, please hit this link.

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