Health and Safety

November Labor Bulletin

December 14, 2016 
By Michael Jordan

A New Chapter in U.S. Healthcare: Provider-Sponsored Plans  
Spurred by the launch of health insurance marketplaces and the transition to value-based care, many health systems are developing their own health plans. In this issue of the MagnaCare Labor Bulletin, we’ll take a look at the trends behind the rise of provider-sponsored plans (PSPs) and what this could mean for unions and other plan sponsors.

Today’s Topic: The Rise of Provider-Sponsored Plans  
The trend toward value-based care has prompted a growing number of health systems to develop their own health plans. The formula for these provider-sponsored plans (PSPs) is simple: lower care costs and improve quality with greater focus on advances in technology and effective, patient-centric care management.

Driving Change
The influence of the Affordable Care Act, advanced technology, market pressures and patient experiences have finally established the growth of PSPs – a health insurance company owned by a health system, physicians group or hospital.

Today, providers are taking on more risk. By starting a health plan, they gain the advantage of using claims data for managing population health as part of a larger trend toward a narrower, and more efficient, provider network.

The rise of the provider-sponsored health plan; What you need to know
Healthcare Finance

Provider-run health plans expanding membership
Employee Benefit News

Provider-sponsored health plans Positioned to win the health insurance market shift
Deloitte

The Power of Partnerships
To expand options, PSPs often partner with existing health plans or other PSPs.

By doing this, they get the product to the market faster, for less money, reduce the regulatory burden, and share risk while utilizing the health plan’s management expertise.

To succeed, PSPs must establish many of the saving measures they’ve already been practicing to meet the demands of population health models.

As a result, the PSPs are prompted to: be more focused on outcomes and patient-centered wellness.
implement health information technology and care management processes sooner rather than later. Pass along the savings to plan participants in the form of lower premiums.

The rise of the provider-sponsored health plan; What you need to know
Healthcare Finance

Provider-run health plans expanding membership
Employee Benefit News

Provider-sponsored health plans Positioned to win the health insurance market shift
Deloitte

What Does This Mean for Unions and Other Plan Sponsors?

Collaborations between health plans and health systems have generated innovative approaches in population health, member engagement, predictive analytics and member retention. These partnerships leverage the health plan’s capabilities and resources, as well as the hospital’s brand and care management skills.

What’s more, the rise in PSPs creates a more competitive landscape. As more unions and other plan sponsors explore cost-curbing strategies, insurers know they have to compete to retain or attract their business by helping them reduce costs and improve care.

Likewise, the efficiencies and better patient experiences that PSPs offer must be delivered at a competitive price to satisfy all stakeholders. With market dynamics supporting the transition to more efficient and effective healthcare financing and delivery, expect continued growth in this new model of care.

Executive Perspectives On Provider-Sponsored Plans
Modern Healthcare

Provider-sponsored health plans Positioned to win the health insurance market shift
Deloitte

Click here to view Michael’s video on the rise of provider-sponsored plans.

December 14, 2016

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