The Role of a Provider-Sponsored Health Plan in Achieving Scale and Integration

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Abstract

Summary

In pursuit of two primary strategies—to become an integrated delivery network (IDN) on the local level and to achieve additional overall organizational scale to sustain operations—Health First, based in Rockledge, Florida, relies on the success of its provider-sponsored health plan (PSHP) as a critical asset. For Health First, the PSHP serves as an agent for holding and administering financial risk for the health of populations. In addition, we are learning that our PSHP is a critical asset in support of integrating the components of our care delivery system to manage that financial risk effectively, efficiently, and in a manner that creates a unified experience for the customer.

Health First is challenged by continuing pressure on reimbursement, as well as by a substantial regulatory burden, as we work to optimize the environments and tools of care and population health management. Even with strong margins and a healthy balance sheet, we simply do not have the resources needed to bring an IDN robustly to life. However, we have discovered that our PSHP can be the vehicle that carries us to additional scale. Many health systems do not own or otherwise have access to a PSHP to hold and manage financial risk. Health First sought and found a not-for-profit health system with complementary goals and a strong brand to partner with, and we now provide private-label health plan products for that system using its strong name while operating the insurance functions under our license and with our capabilities.

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