The Brief

Private Medicaid health plans lost millions of members in the past year as pandemic protections that prohibited states from dropping anyone from the government program expired.

But despite Medicaid’s unwinding, as it’s known, at least two of the five largest publicly traded companies selling plans have continued to increase revenue from the program, according to their latest earnings reports.

“It’s a very interesting paradox,” said Andy Schneider, a research professor at Georgetown University’s McCourt School of Public Policy, of plans’ Medicaid revenue increasing despite enrollment drops.

Medicaid, the state-federal health program for low-income and disabled people, is administered by states. But most people enrolled in the program get their health care through insurers contracted by states, including UnitedHealthcare, Centene, and Molina.

The companies persuaded states to pay them more money per Medicaid enrollee under the assumption that younger and healthier people were dropping out — presumably for Obamacare coverage or employer-based health insurance, or because they didn’t see the need to get coverage — leaving behind an older and sicker population to cover, their executives have told investors.

Several of the companies reported that states have made midyear and retrospective changes in their payments to plans to account for the worsening health status of members.

In an earnings call with analysts on April 25, Molina Healthcare CEO Joe Zubretsky said 19 states increased their payment rates this year to adjust for sicker Medicaid enrollees. “States have been very responsive,” Zubretsky said. “We couldn’t be more pleased with the way our state customers have responded to having rates be commensurate with normal cost trends and trends that have been influenced by the acuity shift.”

Health plans have faced much uncertainty during the Medicaid unwinding, as states began reassessing enrollees’ eligibility and dropping those deemed no longer qualified or who lost coverage because of procedural errors. Before the unwinding, plans said they expected the overall risk profile of their members to go up because those remaining in the program would be sicker.

UnitedHealthcare, Centene, and Molina had Medicaid revenue increases ranging from 3% to 18% in 2023, according to KFF. The two other large Medicaid insurers, Elevance and CVS Health, do not break out Medicaid-specific revenue.

The Medicaid enrollment of the five companies collectively declined by about 10% from the end of March 2023 through the end of December 2023, from 44.2 million people to 39.9 million, KFF data shows.

In the first quarter of 2024, UnitedHealth’s Medicaid revenue rose to $20.5 billion, up from $18.8 billion in the same quarter of 2023.

Molina on April 24 reported nearly $7.5 billion in Medicaid revenue in the first quarter of 2024, up from $6.3 billion in the same quarter a year earlier.

On April 26, Centene reported that its Medicaid enrollment fell 18.5% to 13.3 million in the first quarter of 2024 compared with the same period a year ago. The company’s Medicaid revenue dipped 3% to $22.2 billion.

Unlike UnitedHealthcare, whose Medicaid enrollment fell to 7.7 million in March 2024 from 8.4 million a year prior, Molina’s Medicaid enrollment rose in the first quarter of 2024 to 5.1 million from 4.8 million in March 2023. Molina’s enrollment jump last year was partly a result of its having bought a Medicaid plan in Wisconsin and gained a new Medicaid contract in Iowa, the company said in its earnings news release.

Molina added 1 million members because states were prohibited from terminating Medicaid coverage during the pandemic. The company has lost 550,000 of those people during the unwinding and expects to lose an additional 50,000 by June.

About 90% of Molina Medicaid members have gone through the redetermination process, Zubretsky said.

The corporate giants also offset the enrollment losses by getting more Medicaid money from states, which they use to pass on higher payments to certain facilities or providers, Schneider said. By holding the money temporarily, the companies can count these “directed payments” as revenue.

Medicaid health plans were big winners during the pandemic after the federal government prohibited states from dropping people from the program, leading to a surge in enrollment to about 93 million Americans.

States made efforts to limit health plans’ profits by clawing back some payments above certain thresholds, said Elizabeth Hinton, an associate director at KFF.

But once the prohibition on dropping Medicaid enrollees was lifted last spring, the plans faced uncertainty. It was unclear how many people would lose coverage or when it would happen. Since the unwinding began, more than 20 million people have been dropped from the rolls.

Medicaid enrollees’ health care costs were lower during the pandemic, and some states decided to exclude pandemic-era cost data as they considered how to set payment rates for 2024. That provided yet another win for the Medicaid health plans.

Most states are expected to complete their Medicaid unwinding processes this year.

Beyond the Rose Bowl and historic bungalows, Pasadena has stranger tales to tell. David Kalbeitzer has been seeking out those stories where rocket science meets the occult and ghosts haunt the city’s grandest buildings.

For Kalbeitzer, a Disney executive who investigates the paranormal in his free time, his fascination with the city’s mysterious side started when he bought a Victorian north of Old Town.

He sensed a spirit at the open house a dozen years ago and took it as a reason to move his family to Pasadena. Then he started learning the city’s history.

David Kalbeitzer, a paranormal investigator from Pasadena, is giving a talk about the city's strange history Saturday night in Old Town.

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Courtesy of David Kalbeitzer

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“I realized, ‘Oh, this place called us just as much as we were looking for it,’” he said.

On Saturday night, he’s sharing the lore he’s collected at Mesmer Mesmer an Old Town shop and event space. While the event is full, there’s a waitlist, and more talks featuring Kalbeitzer are in the works.

A city of ghost stories 

Ask Kalbeitzer about haunted Pasadena, and the list stretches from alleyways to the Colorado Street Bridge to Castle Green, the turreted former hotel overlooking Central Park.

“The Pasadena Playhouse theater is, you know, very haunted,” he added.

He says playgoers have reported hearing disembodied voices.

“And you look, and there’s no one there, or apparitions that have been seen sort of standing in the corner, and then you walk up, and they kind of disappear,” he said.

As for the spirit that helped draw him to his current Pasadena home?

Kalbeitzer says she’s still around — and a psychic friend says she has a name: Dolores.

“It’s actually haunted by a very kind ghost that looks out for the house, protects my family and has been able to activate our alarm,” he said.

Having a Dolores in the house might send some people running, but Kalbeitzer said he grew up in a haunted house in Idaho Falls, Idaho.

And when his family moved to Charleston, South Carolina, a teenage Kalbeitzer started seeking out places known for paranormal activity.

Rocket science, ritual magic and mind-reading

Having lived in different neighborhoods in L.A., Kalbeitzer says there’s something uniquely otherworldly about Pasadena — and it goes beyond ghost stories.

He said the city has an energy that draws people exploring the unknown, perhaps most famously Jack Parsons.

The rocket pioneer who helped launch the Jet Propulsion Laboratory also practiced ritual magic at his Pasadena home with the likes of L. Ron Hubbard before he founded Scientology.

“Many people call it the occult. I don’t know that I fully subscribe to that, but there is spiritualism and occult mixed in there,” Kalbeitzer said.

Then there was Upton Sinclair, the muckraking author of The Jungle, whose interests while living in Pasadena extended to telepathy and séances.

Upton Sinclair, pictured with his wife Mary Craig Sinclair in 1935, several years after he published a book examining her reported telepathy.

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Los Angeles Times via Wikimedia Commons

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In 1930, Sinclair published Mental Radio, a book about experiments in mind-reading. Albert Einstein provided a preface. Yes, that Einstein, who would spend the following winter at Caltech expanding on the theories of relativity and cosmology.

“Like it’s the craziest mixture of things that were happening at that time and all of it at the same time,” Kalbeitzer said.

A presence in the shop 

The event couldn’t have found a more appropriate venue.

Since opening five months ago in Old Town, Mesmer Mesmer has embraced the dark and mysterious, offering tarot and crystal readings and hosting events on subjects such as hip-hop’s relationship with ghosts.

At that event, a medium told owner Tyke O’Brien she could sense a presence in the shop, which formerly housed a bridal store.

“She goes, ‘Do you ever feel it?’” O’Brien recounted, “And I’m like, ‘I am such a bummer. I really wish I could. How wonderful would that be to be able to?’”

The same can be said for this writer who’s lived and worked in and around Pasadena for years without so much as a brush with the otherworldly.

Kalbeitzer, on the other hand, reports supernatural encounters all around town.

“I think that how you see yourself in the world has a lot more to do with it, and whether you want to have those experiences,” he said.

Los Angeles officials expect construction of a fence around MacArthur Park will start in November and continue through fall 2027. 

At a community meeting Thursday night at MacArthur Park Elementary School, officials said fence installation is now expected to continue through fall 2027, overshooting the previously announced spring 2027 completion date.

Thursday’s meeting highlighted the divide over the city’s plan to fence off MacArthur Park, with tensions rising during public comment. The Los Angeles Police Department says the fence will make drug enforcement easier, while some in the community who volunteer around the park questioned whether it will improve safety enough to justify the cost.

The city has allocated $2.3 million for the project, but officials have not said whether that will cover the full cost.

Installation of the green metal fence around the park’s perimeter is expected to begin in November and take about a year. A second phase, adding decorative elements to the fence, is planned for fall and winter 2027. Officials said the schedule could change because of weather or other unforeseen circumstances.

The park is expected to remain open during construction.

Capt. Ben Fernandes with the LAPD’s Rampart Division said the fence would create a barrier along Alvarado Street and other areas where officers have seen people using narcotics. That would allow police to focus more of their enforcement efforts inside the park, he said.

“So if people are going deeper into the park to use, that’ll make it easier for us to go in and do enforcement on them and arrest them for that use,” Fernandes said. 

MacArthur Park will close every night once an 8-foot-tall fence goes up around the green space, with Los Angeles police officers sweeping the park for encampments and people sleeping there before the gates shut. The Board of Recreation and Park Commissioners approved the plan Thursday.

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LA Recreation and Parks

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“I’ve been an officer for 29 years, and I’ve always known I can go buy drugs there, and I did as a narcotics officer. So what I’m saying is, we are trying to make it not convenient,” he added. 

Fernandes also said the city plans to enhance the park’s existing camera network. LAPD officers and Los Angeles Park Rangers will be able to monitor the cameras from their respective stations, he said. City officials are still evaluating whether additional cameras will be needed to address blind spots in the park after construction is complete.

Ariana Walker, who visits MacArthur Park every Saturday with a group of friends who pool their own resources to distribute food and hygiene kits, questioned whether the city had shown that the fence would improve safety and how much it would cost to maintain.

“The fence is a $2.3 million fence at the base level,” she said. “And they haven’t given us any indication of how much more it’s going to cost for upkeep, to keep anybody safe. There’s no conclusive evidence that a fence is going to stop crime the way that they’re suggesting.”

The meeting grew tense when John Alle, a local property owner whose family owns the building that houses Langer’s Delicatessen across the street from the park, objected to having his comments read from a written comment card rather than speaking directly to officials. Alle has been a vocal critic of the city’s response to drug activity and public safety concerns around MacArthur Park.

He was allowed to comment during the meeting and said the city needs to take a tougher approach to drug use and sales around the park. 

“We see knife attacks at all hours of the day. It’s out of control. And it’s not gotten any better,” he said. “We want to bring it back to where it was 15 or 20 years ago.”

Los Angeles officials expect construction of a fence around MacArthur Park will start in November and continue through fall 2027.

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Gary Coronado

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The LA Local

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Alle pointed to public events at the park, including an upcoming Día de los Muertos celebration and a Labor Day weekend picnic hosted by Los Angeles County District Attorney Nathan Hochman as positive developments for the space. But he added those events do not reflect conditions throughout the park.

Officials also outlined other planned improvements, including restoring access through the tunnels connecting the park’s north and south sides, making accessibility upgrades and providing free Wi-Fi for parkgoers. 

Residents who want to provide input on the fence’s decorative elements can email admin@themorcosgroup.com or call (310) 479-4727 for more information.

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