When hospitals become insurers

Anna Wilde Mathews on hospital-insurer integration in the WSJ:

Like insurers, which are building lower-cost “narrow network” plans for the exchanges, the hospital systems are betting that consumers will be willing to accept a smaller choice of health-care providers in return for the promise of smoothly integrated care and premiums that are likely to be lower. The hospital systems plan to build their coverage around their own networks, but may fill them out with other providers as well.

Hospital systems say their focus is on providing high-quality care, and they think that the better technology that helps them closely track patients will ensure they avoid some of the financial pitfalls of decades ago. Also, today “there is financial urgency,” said Frank Williams, chief executive of Evolent Health, which is advising many hospital systems pursuing integrated operations, including Piedmont. [Emphasis added.]

Is there research on the extent to which provider-insurer integration of the type reported actually reduces premiums and increases quality? Yes there is, but not much, and colleagues and I have done it. As it is not yet published, I’ll write more about it another time.



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