Dive Brief:
- Cigna and SCAN Health Plan agreed to team up to provide retirees in California with Medicare Advantage benefits, Cigna announced on Tuesday.
- Both companies will remain independent in the effort, a "coopetition" that makes it less expensive for insurers to enter new markets and take advantage of programs like Medicare Advantage for the benefit of their members.
- "Our companies have a common commitment to clinical quality, customer service and engaging with healthcare professionals to enhance healthcare delivery," Chris De Rosa, president of the West region for Cigna, said in the release. What that means, in day to day terms, is that SCAN will help Cigna move Medicare beneficiaries over to Medicare Advantage.
Dive Insight:
Medicare Advantage is an attractive program for insurers. After all, patients covered by the plan are typically in better health than most because they had been previously covered through employer-based benefits.
These kinds of partnerships, though they fly in the face of the typical business model of jumping into a new market and trying to corral all the patients for yourself, are beneficial for patients and reduce the costs of entry for insurers. These types of loose partnerships should remain popular in years to come, as a way to get a piece of growing markets like Medicare without having to overpay in a full acquisition.