Medicare Set Asides were a hot business for a couple of years with NuQuest HealthAdvocates and Gould and Lamb dominating the industry. Then Coventry entered the market thru its priority services sub, quickly moving up to the fourth spot. Coventry stumbled with its guarantee recently, losing a couple of clients (namely AIG and Macy’s).
Today the MSA business is growing but not nearly as fast as in 2006. The big jumps in volume in the sector are pretty much over; while most vendors are seeing some increases in volume, the double-digit growth of the past looks to be gone.
There are still new entrants but the show floor isn’t nearly as crowded with erstwhile MSA vendors as it was last year.
What’s next? Depends on the Feds and adoption rates in other lines of business. Expect to see MSAs become more prevalent in other P&C lines especially GL and other liability lines.
Apr
28
Coventry was the #1 vendor in terms of MSA volume followed by Gould and Lamb and Health Advocates. NuQuest has always been a distant fourth place.
I disagree that the sector is not growing, it is certainly growing in the double digits. What you are seeing is the big three losing market share to smaller, more competant and more professional firms. While the big three are shrinking (or imploding as is the case with Coventry), the second tier firms are growing in excess of 100% per year.
The fact that more MSA vendors were not at RIMS has more to do with the quality, or lack thereof, of the RIMS show than the viability of the MSA marketplace.
Ryan Roth
President
MEDVAL
In 2008 we continue to experience double digit growth on tremendous annual revenues from 2007. G&L is the clear leader in the market and has been since 2003, nearly double Coventry’s revenues in 2007. Joe’s comments are accurate that the market is not growing as fast as it used to, but it didn’t exist prior to 2002 either, so there is some natural leveling. With regard to the Big 3 losing business…based on what I know, that’s isolated to just 2 of the 3. Regional competition is not capable of competing on a national level and the reality is that there are less than 8 vendors with annual MSA revenues above $5MM.
John Williams
Gould & Lamb