Medical Claims and Benefits Payable

9 Months Ended

Sep. 30, 2019

Other Liabilities Disclosure [Abstract]

The following table provides the details of our medical claims and benefits payable as of the dates indicated.



	September 30, 2019		December 31, 2018
	(In millions)
Fee-for-service claims incurred but not paid (“IBNP”)	$	1,424	$	1,562
Pharmacy payable	128		115
Capitation payable	57		52
Other	366		232
	$	1,975	$	1,961

“Other” medical claims and benefits payable includes non-risk provider payables, where we act as an intermediary on behalf of various government agencies, for certain providers, without assuming financial risk. Such receipts from government agencies and payments to providers do not impact our consolidated statements of income. Non-risk provider payables amounted to $239 million and $107 million as of September 30, 2019, and December 31, 2018, respectively.

The following table presents the components of the change in our medical claims and benefits payable for the periods indicated. The amounts presented for “Components of medical care costs related to: Prior periods” represent the amounts by which our original estimate of medical claims and benefits payable at the beginning of the period were more than the actual amount of the liability, based on information (principally the payment of claims) developed since that liability was first reported.



	Nine Months Ended September 30,
	2019			2018
	(In millions)
Medical claims and benefits payable, beginning balance	$	1,961		$	2,192
Components of medical care costs related to:
Current period	10,613			11,670
Prior periods ⁽¹⁾	(253		)	(308		)
Total medical care costs	10,360			11,362
Change in non-risk and other provider payables	131			60
Payments for medical care costs related to:
Current period	8,996			9,866
Prior periods	1,481			1,706
Total paid	10,477			11,572
Medical claims and benefits payable, ending balance	$	1,975		$	2,042

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(1)	The September 30, 2018, amount includes the 2018 benefit of the 2017 Marketplace CSR reimbursement of $81 million.

Our estimates of medical claims and benefits payable recorded at December 31, 2018, and 2017 developed favorably by approximately $253 million and $308 million as of September 30, 2019, and 2018, respectively.

The favorable prior year development recognized in the nine months ended September 30, 2019, was primarily due to lower than expected utilization of medical services by our Medicaid members, and improved operating performance. Consequently, the ultimate costs recognized in 2019, as claims payments were processed, were lower than our original estimates in 2018.