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Mid Atlantic Medical Svcs (MME) Message Board

  • matollionequay matollionequay May 2, 2003 10:30 AM Flag

    Understanding underwiting

    Today's releases after Cigna's announcement fixate on worries over plans' ability to control healthcare costs. This concern is only part of the equation. The other part is a plan's ability to price ahead of the increases. Thus, an 8 - 12 increase in costs is ok if it was anticipated by an equal or greater increase in premium. I believe Mamsi's increases are at least 11 - 13 year over year and are ahead of medical cost increases. With regard to their ability to price into the future, who is going to stop them? The BlueCross BlueShield plan in the Balt/Wash area is in complete disarray and is marketing larger increases that are fueling a steady enrollment increase to Mamsi of better risk patients. BCBS appears in a "death spiral". They will manage to keep the worst risk. Thus Mamsi can continue to grow in its core market. It offers exceptional customer service and is actually developing brand loyalty. The announcement will show big increases in enrollment, premium, and profit.