- Minneapolis-based health insurer Medica is buying Mayo Clinic’s third-party health benefits business, the Minneapolis/St. Paul Business Journal reports.
- Mayo Clinic Health Solutions, formerly Mayo Management Services, processes and handles benefits administration for self-insured companies.
- The division accounted for about $15 million in revenue in 2016, according to Mayo Clinic’s annual financial report. Terms of the deal were not disclosed.
Medica and the clinic have had a working relationship for years. In 2014, the insurance giant launched a narrow network plan in Rochester, Minn., that relied entirely on Mayo Clinic Health System providers. Known as Medica With Mayo Clinic, the plan allowed the insurer to charge less for the new product by aligning with a single care system.
With the continuing transition to value-based care, more healthcare organizations are looking for ways to diversify their revenue stream. Merging programs and aligning various parts of the healthcare system are increasingly popular ways for organizations trying to improve overall performance as well as financials.
UPMC has a health insurance arm, UPMC Health Plan, that has performed well in its western Pennsylvania home. The system hopes to grow it now in central Pennsylvania with the purchase of Harrisburg-based PinnacleHealth.
Two years ago, UPMC created UPMC Enterprises to develop and commercialize novel technologies. Since then, it has taken on precision medicine with Cernostics and partnered with IBM Watson on Pensiamo, a joint venture aimed at helping hospitals improve supply chain performance, among other initiatives.
In another example, Children’s Hospital of Philadelphia is also pursuing the entrepreneurial model, exploring a range of implantables and other devices to improve outcomes and quality of life. Currently, the health system has about 50 projects in the works.
CHOP’s formula for success is three-pronged, Patrick Fitzgerald, vice president for entrepreneurship and innovation, told Healthcare Dive in September: Create a culture that encourages ideas and innovation; make wealth of knowledge and experience available beyond the health system; and seek internal solutions that can be parlayed into new service offerings for patients.