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UnitedHealth Claims Biggest Piece of Medicare Drug Pie

APRIL 28, 2006 -- Insurance giant UnitedHealth Group has enrolled the largest number of Medicare beneficiaries in both stand-alone drug plans and Medicare Advantage plans with drug coverage, according to data the Centers for Medicare and Medicaid Services (CMS) released Friday.

UnitedHealth plans account for nearly 3.8 million, or 27 percent, of the 13.9 million Medicare beneficiaries enrolled in prescription drug plans and about 1.2 million, or 20 percent, of the nearly 6 million beneficiaries enrolled in Medicare Advantage plans, according to the CMS statistics.

UnitedHealth plans offered to AARP members comprise about 2 million of that 5 million enrollment figure, AARP officials said earlier this week.

Other top prescription drug plan (PDP) players include Humana Inc. (2.4 million or 18 percent of enrollees), Wellpoint, Inc. (just over 1 million or 7 percent of enrollees), and Member Health Inc. (924,100, or 7 percent of enrollees).

Kaiser Permanente plans have enrolled nearly 822,000, or 14 percent, of beneficiaries in Medicare Advantage plans with drug coverage and Humana has captured 13 percent with 792,500 enrollees.

According to preliminary analysis by Avalere Health, a health care consulting firm, the top 10 PDP plans represent 80 percent of the beneficiaries who have enrolled in those plans. National PDPs claim 61 percent of that enrollment.

Avalere analysts also found that the top 10 Medicare Advantage plans that offer drug coverage (MA-PDs) account for 64 percent of the enrollment so far in those plans.

Forty-two percent of enrollment nationally is concentrated in the Humana and UnitedHealth PDP and MA-PD products combined, said Avalere president Dan Mendelson.

"There is a high degree of concentration among a relatively smaller number of plans," Mendelson said. In the long run, he said, it will help produce market stability and concentration. "It means that these plans will probably be able to leverage better prices over some period of time . . . It could help keep premiums low."

As of March 31, Medicare beneficiaries in stand-alone drug plans had filled 46.4 million prescriptions while Medicare Advantage plans with drug coverage filled just over 46 million, according to the CMS data.

Medicaid beneficiaries automatically enrolled into the Medicare drug plan as a "dual eligible" have filled 88 million prescriptions while retirees covered by the Medicare drug subsidy have filled 58 million prescriptions. Federal retirees have filled nearly 30 million prescriptions.

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