How financial alliances, payment models can reshape the health insurance industry
The Affordable Care Act has created a sea change in healthcare and is allowing innovative solutions to reshape the health insurance industry, according to a series in the New Yorker.
In response to all the changes, the health insurance industry is evolving, writes author Rena Xu, a resident physician at Massachusetts General Hospital in Boston. As FierceHealthPayer previously reported, the first new approach she advocates focuses on building a relationship between insurers, patients and providers to address problems with the existing insurance system and capitalize on opportunities offered by the health insurance exchanges created by the ACA.
Another approach focuses on new attempts to sell insurance directly to patients, including one of the more visible examples, the two-year-old startup company Oscar that sells insurance to individuals on the healthcare exchanges, according to a second New Yorker essay. As it works to reinvent the industry, Oscar has attracted 40,000 members in New York and New Jersey, where it currently operates, with plans to expand to Texas and California this fall, Xu writes.
However, new strategies are not without challenges, she notes. Another example of the direct-to-consumer model is the consumer operated and oriented plans (CO-OPs), which, like Oscar, sell insurance on the exchanges. The CO-OPs have hit rough seas, and last week Utah became the 10th of the 23 non-profit organizations created under the ACA to shut down because of financial instability.
In addition, changes in the industry have provided motivation for providers and insurers to move toward value-based healthcare, including innovative payment models, according to a third New Yorker essay. In response, companies are helping providers establish partnerships with insurers, Xu says. That includes two innovative approaches to finance healthcare: Health systems creating their own insurance plan or partnering with existing insurers.
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