Dive Brief:
- Today, 13% of all US health systems offer health plans in one or more markets, either commercial, Medicare Advantage (MA) or managed Medicaid, according to a new report from McKinsey & Company. Together, these 107 systems operate health plans covering about 18 million members, about 8% of all insured lives. Ten more provider-led plans will be offered on the public exchanges in 2015.
- Approximately 8.9 million people, or about half of those covered by provider-led plans are enrolled in Medicaid products.
- While many providers believe they deliver efficient, outstanding care and superior customer service, and that those things would translate if they offered a health plan, a new McKinsey & Company report says many of these providers will fail to meet their expectations.
Dive Insight:
While it's not yet clear whether provider-led plans will succeed (and the report authors make that clear), there are a number of advantages and disadvantages to consider. Among the advantages: In-house plans can help provider organizations to preserve or increase volume in settings where payers are attempting to steer lives. Also, having these plans in place can permit the systems to leverage local or geographical economies of scale as well as skill. However, stakeholders must figure out how to resolve the inherent tension between payer and provider when creating plans.