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Medical Claims and Benefits Payable (Tables)

12 Months Ended

Dec. 31, 2020

Schedule of liability for unpaid claims and claims adjustment expense

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

Components of the change in medical claims and benefits payable

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

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(1)December 31, 2018, includes the 2018 benefit of the 2017 Marketplace CSR reimbursement of $81 million.

Incurred and paid claims development

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

Reconciliation of claims development to liability

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