Medical Claims and Benefits Payable

9 Months Ended

Sep. 30, 2021

Other Liabilities Disclosure [Abstract]

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


	September 30, 2021		December 31, 2020

	(In millions)
Fee-for-service claims incurred but not paid (“IBNP”)	$	2,246	$	1,647
Pharmacy payable	209		157
Capitation payable	86		70
Other	650		528
Magellan Complete Care acquisition opening balance	—		294
Total	$	3,191	$	2,696

“Other” medical claims and benefits payable includes 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 $301 million and $235 million as of September 30, 2021, and December 31, 2020, respectively.

The following table presents the components of the change in our medical claims and benefits payable for the periods indicated, with the prior period recast to conform to the current year presentation. The amounts presented for “Components of medical care costs related to: Prior years” represent decreases in medical care costs resulting from actual medical care costs being less than we previously estimated in the prior year.


	Nine Months Ended September 30, 2021
	Medicaid		Medicare		Marketplace		Consolidated

	(In millions)
Medical claims and benefits payable, beginning balance	$	2,129	$	392	$	175	$	2,696
Components of medical care costs related to:
Current year	13,491		2,195		1,872		17,558
Prior years	(158)		(36)		(22)		(216)
Total medical care costs	13,333		2,159		1,850		17,342
Payments for medical care costs related to:
Current year	11,530		1,816		1,534		14,880
Prior years	1,538		340		130		2,008
Total paid	13,068		2,156		1,664		16,888
Change in acquired balances	(19)		(8)		—		(27)
Change in non-risk and other provider payables	68		—		—		68
Medical claims and benefits payable, ending balance	$	2,443	$	387	$	361	$	3,191


	Nine Months Ended September 30, 2020
	Medicaid		Medicare		Marketplace		Consolidated

	(In millions)
Medical claims and benefits payable, beginning balance	$	1,465	$	267	$	122	$	1,854
Components of medical care costs related to:
Current year	9,029		1,588		861		11,478
Prior years	(41)		(25)		—		(66)
Total medical care costs	8,988		1,563		861		11,412
Payments for medical care costs related to:
Current year	7,470		1,316		714		9,500
Prior years	1,193		233		101		1,527
Total paid	8,663		1,549		815		11,027
Change in non-risk and other provider payables	50		—		—		50
Medical claims and benefits payable, ending balance	$	1,840	$	281	$	168	$	2,289

Our estimates of medical claims and benefits payable recorded at December 31, 2020, and 2019 developed favorably by approximately $216 million and $66 million as of September 30, 2021, and 2020, respectively.

The favorable prior period development recognized in the nine months ended September 30, 2021 was primarily due to lower than expected utilization of medical services by our members and improved operating performance. Consequently, the ultimate costs recognized in 2021, as claims payments were processed, were lower than our previous estimates in 2020.