Dive Brief:
- Independence Blue Cross of Philadelphia isn't hitching itself to the healthcare M&A bandwagon quite yet, opting instead to focus on strategic partnerships as avenues for growth.
- For example, the insurer owns a majority stake of AmeriHealth Caritas, one of the largest Medicaid benefits managers in the country. Independence has access to customers in 24 states via that partnership.
- Independence is facing a rigorous fight for market share with bigger competitiors such as Aetna, whose $37 billion deal to snap up Humana will create an insurance behemoth if it gets approval.
Dive Insight:
Mergers and acquisitions may be the name of the game for many of the biggest players in the industry. But as Independence's example demonstrates, it's not the strategy that every insurer is pursuing.
"We believe that we are of a size that if we continue to go it alone, we will be very successful, but we are very open to exploring strategic alliances, collaborations, and who knows what that means in terms of consolidations down the road," said Independence CEO Daniel J. Hilferty in an interview with The Philadelphia Inquirer.
Lurking beneath this partnership-based approach is the advent of the Affordable Care Act, which has helped propel Independence to steady 2014 growth. Independence plans sold through ACA marketplaces brought in hundreds of thousands of new customers for the company, leading to a 12% increase in its consumer plans.
For now, the insurer plans to continue its partnerships and collaborations, including with other Blue Cross companies, and will aim to compete with newly-created insurance giants such as Anthem-Cigna and Aetna-Humana by offering more competitive plans on ACA marketplaces.