The End of Insurance Companies?
The Fiscal Times and The Washington Post have reported that hospitals are plotting “the end of insurance companies” by trying to cut these middlemen out of the equation.1,2 However, experts say the trend of hospitals developing their own health plans is part of a larger movement toward integrated health care delivery, which includes medical homes, accountable care organizations (ACOs), and shared financial risk between insurers and providers for managing the health care needs of populations as physician and hospital reimbursement models transition from fee-for-service to bundled payments.
Typically, hospital-based health insurance plans are launched by larger multiple-hospital systems with regional coverage, often through partnering with an experienced insurer to create a hospital-branded product. They also require coordination with medical groups, particularly the all-important primary care providers, and better communication among physicians, ideally through compatible electronic health records, said Shantanu Nundy, MD, MBA, managing director of clinical innovation for Evolent Health in Arlington, Virginia. Evolent Health partners with health systems to transform how they deliver care, which may involve building health insurance plans.
“There’s definitely a trend for provider systems to assume more risk for patients’ health,” Dr. Nundy said. “The ways they do that vary along a spectrum, but this trend definitely includes provider systems themselves becoming insurers, putting together health plans, [and] using ACOs or contracting with ACOs to take on risk for population health.”