Lessons for Adding or Building New Health Plans That Can Successfully Compete for Providers and Patients

Take Medicare Advantage. In response to the fast growth in the Medicare-eligible population and strong interest in Medicare Advantage, both new and established insurers have seized this opportunity. In the past five years, the number of MA plans has soared nearly 75%, with a 13% increase in the past year–during the height of the pandemic. That brings the total to 3,550 plan offerings, according to an October 2020 KFF report. In fact, KFF reported, the typical Medicare beneficiary has access to 33 MA plan types.

For MA and all other lines of business, the key is a shift in strategy and implementation that focuses on a much closer alignment of the plan and its contracted providers. Importantly, it must include financial arrangements that work for both, with provider-specific pathways to success in value-based payments. It also requires plans to supply providers with tools, such as advanced IT and analytics capabilities, to support value-based care.

Building a partnership of equals that fosters collaboration and cooperation is essential for managing population health and total cost of care. Plans that bake in a provider-aligned approach can offer a much more attractive proposition for providers, especially the top performers. Without the right providers, the plan is at a distinct disadvantage.