The Bottom Line

Consolidation moves onto next stage

Mixed financial performance across MCOs

Regulatory impacts clarifying

Executive Summary

Highlights from this issue:

  • The first quarter of 2019 allowed for a settle down period for the active M&A and regulatory cycles seen in Q3 and Q4 of 2018.
  • The big consolidation news of Q1 was the WellCare-Centene deal which would create the largest national Medicaid plan.
  • Questions on the Mega-Reg rewrite remain open. 
  • New disruption in the PBM space occurred with the proposed rules around safe harbor limits.  
  • Private investment dollars continue to flow into the Medicaid IT space, but life sciences investments saw an uptick in Q1.  
  • Most financial performance reported in Q1 showed generally flat MCO revenues, with mixed interest in stocks.

Latest MCO leader survey results

  • Spread pricing impacts on MLR
  • Buy-in programs gaining traction
  • Work requirements (operational lift)
  • Moving providers to new payment models
  • Network management
  • Tech investment ROI

Industry Interviews

Each issue we interview a Medicaid Managed Care executive and an Investment Leader

John Lovelace

President, Government Programs and Individual Advantage at UPMC Health Plan

Brett Moraski

Operating Partner at Frazier Healthcare

MCO Financial Performance


Most MCOs closed out 2018 with fairly flat revenues and EBITA. Market showed variable interest in Q1 based on pricing and volume behaviors. 

  • EOY 2018 analyses in and reviewed. 
  • Last analysis before Aetna data and trends absorbed into CVS reporting. 

Latest MCO Quarterly Financials


Gross Profit

Earnings Before Interest and Taxes

Detailed Analysis













CVS (Aetna)





















A Quick Glance At Key Regulations With Possible Impact to Medicaid Plans
  • Changes to Managed Care Reg
  • New safe harbor / AKS rules around PBM pricing
  • Limited expansion requests to CMS
  • Efforts to prevent silver loading
  • Interoperability and patient EHR access regs
  • Hospital pricing transparency rules
  • Changes to HCBS place of service criteria

Merger and Acquisitions Activity 

  • CVS-Aetna
  • Anthem-Cigna deal failure fallout
  • Large provider systems activity
  • Retail and tech health focused partnerships
  • Life sciences activity

Investment News

A Quick Glance At Key Deals in PE/VC Arena With Possible Impact to Medicaid Plans
  • $2.6B raised in Jan for healthcare startups
  • Ex-Anthem CEO started a health tech investment firm
  • Verily Life Sciences (Alphabet) gets $1B 

Vendor Reviews

Your staff are constantly asked to sit through vendor demos and pitch meetings. Is it worth the time? 

Our simple grid below helps you decide. 

Vendor Name

Overall Assessment for Medicaid Readiness

Detailed Analysis



Digital Harbor, Inc.



Lucina Health

Medical Advantage Group

Mom's Meals


Vheda Health

Evaluation removed at request of vendor CEO. Contact your assigned consultant for additional information. 


Need to update info in one of our reviews? Disagree with our assessment? Send us a note to clay@mostlymedicaid.com to schedule a call with one our analysts to provide more information. 

Evaluation methodology