Medicaid Plans Core Administrative Expense Growth Decelerates in 2022

PHILADELPHIA--(BUSINESS WIRE)--In 2022, per member per month Core expenses increased by 2.4%, below the 2.6% increase in 2021. Core expenses exclude the plans’ Sales and Marketing expense clusters. Trends are of continuously reporting plans and eliminate the effect of product mix changes. Median PMPM costs for Medicaid HMO were $30.82, and $36.41 for all products.

The results are summarized in Plan Management Navigator and are posted at sherlockco.com/navigator. Navigator excerpts from the 2023 Medicaid edition of Sherlock Benchmarks which analyzes and reports on the in-depth surveys of 15 Medicaid plans that collectively served 15.5 million members with Comprehensive products. Medicaid comprised on average 56% of their members. Medicaid membership in these plans increased by 11%. With other universes, the Sherlock Benchmarks universes analyze the administrative costs of plans serving 17% of all Medicaid beneficiaries.

The Account and Membership Cluster grew fastest among the Core clusters at 5.7%, with Claims its fastest growing function and most impactful. This cluster’s growth was the fastest since 2019’s increase of 9.7%.

We will discuss the results via free web conference on Wednesday, October 11^th from 2:00 PM to 3:00 PM Eastern Daylight Time. Douglas Sherlock will offer a brief presentation, followed by questions and answers. To participate in the web conference, please register at sherlockco.com/webinar. Once registered, dial-in information and a link to connect will be provided in a confirmation email.

The Sherlock Benchmarks are the health plan industry’s metrics informing the management of administrative activities. They are based on surveys of health plans serving 63 million Americans and provide costs and their drivers on key administrative activities. Health plans use them to determine whether their administrative costs are optimal and to prioritize improvements among numerous specific activities.

The Sherlock Benchmarks for 2023 reflect 1,000 health plan years of experience spanning 26 consecutive years. They are the “gold standard” of benchmarks and used to measure and manage health plan administrative activities in health plans serving over 208 million members. Planning, budgeting and cost benefit analyses are informed by the Sherlock Benchmarks.

Besides the Medicaid universe, others include Blue Cross Blue Shield plans, Independent/Provider-Sponsored plans and Medicare plans.

Sherlock Company (www.sherlockco.com), based in Gwynedd Valley, Pennsylvania, provides informed solutions for health plan financial management. Since its founding in 1987, Sherlock Company has been known for its impartiality and technical competence in service to its clients.