Hospitals make major inroads in insurance biz
More hospitals and health systems are getting into the insurance business, eliminating health insurers from the process, the Fiscal Times reported. For example, Mount Sinai Health System in New York City will offer its own Medicare Advantage plan starting next year as a way to keep premium payments inside the hospital system.
"Inevitably, the large systems are going to move to take part of the premium dollar," Mount Sinai President and CEO Kenneth L. Davis, M.D., said at The Atlantic's Health Care Forum in Washington, D.C.
Only last week, the CentraState Health System in Freehold, N.J., launched its own health plan for small- and medium-sized businesses, NJ.com reported. Meadowlands Hospital Medical Center in Secaucus has created a plan similar to CentraState's multiple employer welfare arrangement health plan (MEWA).
As more healthcare providers enter the insurance market, health insurers as we know them may cease to exist. Ezekiel Emanuel, former White House healthcare adviser, predicts accountable care organizations will replace them, FierceHealthPayer previously reported.
At The Atlantic's Health Care Forum, Emanuel warned of the "Kaiserification" of healthcare --Kaiser Permanente's integrated healthcare model that combines a health insurance company with subsidiary hospitals and medical practices. "[T]he wave of the future is integrated delivery systems--integrating insurance with delivery function," Emanuel said, according to the Fiscal Times.
Kaiserification is well under way. For example, WellPoint recently acquired a healthcare company in California, Emanual noted. Moreover, WellPoint's CareMore unit teamed up with a large health system in Atlanta to jointly manage about 7,500 Medicare Advantage patients.
New competition from providers launching their own health plans doesn't have to signal the end of insurance companies. MedStar Health, the largest health system in Baltimore-Washington, D.C., offers its own health plan called MedStar Select, but isn't trying to compete directly with insurers.
"I think insurance companies have a role that extends well into the future and it's not that we're out there trying to put them out of business or minimize the role that they have in the American healthcare system," Eric R. Wagner, MedStar's executive vice president of external affairs, told FierceHealthPayer in an interview. "So we all just need to figure out how to work together better and more effectively to allow transformation to happen," he said.
For more:
- read the Fiscal Times article
- here's the NJ.com article
- read the Chicago Business article
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