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Medical Claims and Benefits Payable | 12 Months Ended
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Dec. 31, 2020
Insurance [Abstract] |
Medical Claims and Benefits Payable | Medical Claims and Benefits Payable The following table provides the details of our medical claims and benefits payable as of the dates indicated.
| December 31,
| 2020 |  | 2019 |  | 2018
| (In millions)
Fee-for-service claims incurred but not paid (“IBNP”) | $ | 1,647 |  |  | $ | 1,406 |  |  | $ | 1,562 |
Pharmacy payable | 157 |  |  | 126 |  |  | 115 |
Capitation payable | 70 |  |  | 55 |  |  | 52 |
Other | 528 |  |  | 267 |  |  | 232 |
Magellan Complete Care | 294 |  |  | — |  |  | — |
Total | $ | 2,696 |  |  | $ | 1,854 |  |  | $ | 1,961 |
“Other” medical claims and benefits payable include amounts payable to certain providers for which we act as an intermediary on behalf of various government agencies without assuming financial risk. Such receipts and payments do not impact our consolidated statements of income. Non-risk provider payables amounted to $235 million, $132 million and $107 million, as of December 31, 2020, 2019, and 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 years” represent the amount by which our original estimate of medical claims and benefits payable at the beginning of the year were more than the actual liabilities, based on information (principally the payment of claims) developed since those liabilities were first reported.
| Year Ended December 31,
| 2020 |  | 2019 |  | 2018
| (In millions)
Medical claims and benefits payable, beginning balance | $ | 1,854 |  |  | $ | 1,961 |  |  | $ | 2,192 |
Components of medical care costs related to: |  |  |  |  |
Current year | 15,939 |  |  | 14,176 |  |  | 15,478 |
Prior years (1) | (119) |  |  | (271) |  |  | (341) |
Total medical care costs | 15,820 |  |  | 13,905 |  |  | 15,137 |
Payments for medical care costs related to: |  |  |  |  |
Current year | 13,871 |  |  | 12,554 |  |  | 13,671 |
Prior years | 1,507 |  |  | 1,482 |  |  | 1,710 |
Total paid | 15,378 |  |  | 14,036 |  |  | 15,381 |
Acquisition - Magellan Complete Care | 294 |  |  | — |  |  | — |
Change in non-risk and other provider payables | 106 |  |  | 24 |  |  | 13 |
Medical claims and benefits payable, ending balance | $ | 2,696 |  |  | $ | 1,854 |  |  | $ | 1,961 |
________________ (1)December 31, 2018, 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, 2020, 2019 and 2018 developed favorably by approximately $119 million, $271 million and $341 million in 2020, 2019 and 2018, respectively. The favorable prior year development recognized in 2020 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 2020 were lower than our original estimates in 2019, which was not discernible until additional information was provided, and as claims payments were processed. The favorable prior year development recognized in 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 were lower than our original estimates in 2018, which was not discernible until additional information was provided, and as claims payments were processed. The favorable prior year development recognized in 2018 includes a benefit of approximately $81 million in reduced medical care costs relating to Marketplace CSR subsidies for 2017 dates of service. The remainder of the favorable prior period development was primarily due to lower than expected utilization of medical services by our Medicaid and Marketplace members and improved operating performance. Consequently, the ultimate costs recognized in 2018 were lower than our original estimates in 2017, which was not discernible until additional information was provided, and as claims payments were processed. The following tables provide information about incurred and paid claims development as of December 31, 2020, as well as cumulative claims frequency and the total of incurred but not paid claims liabilities. The cumulative claim frequency is measured by claim event, and includes claims covered under capitated arrangements.
Incurred Claims and Allocated Claims Adjustment Expenses |  | Total IBNP |  | Cumulative number of reported claims
Benefit Year |  | 2018 |  | 2019 |  | 2020 |
|  | (Unaudited) |  | (Unaudited) |  |  |  |  |  |
|  | (In millions)
2018 |  | $ | 15,478 |  |  | $ | 15,245 |  |  | $ | 15,233 |  |  | $ | 11 |  |  | 110 |
2019 |  |  |  | 14,176 |  |  | 14,083 |  |  | 27 |  |  | 100 |
2020 |  |  |  |  |  | 15,939 |  |  | 1,593 |  |  | 93 |
|  |  |  |  |  | $ | 45,255 |  |  | $ | 1,631 |  |  |
Cumulative Paid Claims and Allocated Claims Adjustment Expenses |
Benefit Year |  | 2018 |  | 2019 |  | 2020 |
|  | (Unaudited) |  | (Unaudited) |  |  |
|  | (In millions) |
2018 |  | $ | 13,752 |  |  | $ | 15,220 |  |  | $ | 15,222 |  |
2019 |  |  |  | 12,554 |  |  | 14,056 |  |
2020 |  |  |  |  |  | 13,871 |  |
|  |  |  |  |  | $ | 43,149 |  |
The following table represents a reconciliation of claims development to the aggregate carrying amount of the liability for medical claims and benefits payable.
|  |  |  |  |  | 2020 |
|  |  |  |  |  | (In millions) |
Incurred claims and allocated claims adjustment expenses |  | $ | 45,255 |  |
Less: cumulative paid claims and allocated claims adjustment expenses |  | (43,149) |  |
All outstanding liabilities before 2018 |  | 16 |  |
Magellan Complete Care |  | 294 |  |
Non-risk and other provider payables |  | 280 |  |
Medical claims and benefits payable |  | $ | 2,696 |  |

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- Definition The entire disclosure for insurance products considered to be short-duration contracts because the contract provides insurance protection for a fixed period of short duration and enables the insurer to cancel the contract or to adjust the provisions of the contract at the end of any contract period, such as adjusting the amount of premiums charged or coverage provided, and on contracts on which amounts are paid but insurance risk is not transferred. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 944 -URI http://asc.fasb.org/topic&trid=2303980 + Details
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