Over the last several years, Medicare Advantage and Part D (MAPD) carriers have increasingly used segmentation as a way to competitively price their MAPD plans throughout their service area. The chart below shows that among local HMO and local PPO bids over the last five years, the proportion of bids that are segmented has more than doubled.

So, what is driving this trend? How are plans using segments to achieve their strategic goals? Or maybe your question is, what the heck is segmentation? This paper will attempt to explain the drivers of this recent trend and provide examples of how segmentation can be used as a tool to help plans gain a competitive edge.

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