Provider Sponsored Plan Presence by State, 2014
Provider Sponsored Plans have a meaningful presence in 30 states.
As a provider of technology for insurer-led private exchanges, we have early visibility into those organizations who are innovating in e-commerce for health insurance. Over the past year we’ve seen a surge in provider sponsored plans (PSPs) moving forward aggressively in their e-commerce approaches. Deloitte has just published an excellent analysis that reinforces this observation: PSPs — defined as health plans that are financially sponsored by a provider (hospital, physician group, health system) — are generating significant momentum in the market.
The Deloitte report emphasizes several trends Array is also seeing. PSPs are in an ideal position to succeed in the individual market due to their strong brands and ability to integrate care financing with care delivery. PSPs can also complement delivery system investments in ACO strategies.
The Deloitte study offers some important new insights based on a regression analysis of PSPs’ financial and market metrics.
- The best performing PSPs in each market are generating better financial success compared to traditional health plans in their markets.
- There is a strong relationship between profitability and market share; the top performing PSPs tend to have at least 100K members.
- By leveraging a complete clinical view of their members, PSPs are in an ideal position to deliver care more efficiently and, as a result, may be able to create a pricing advantage in their markets.
Deloitte’s analysis concludes that “PSPs’ recent successful performance is evidence of their emergence as a potentially disruptive industry innovator.” From an Array perspective, the proactive way that PSPs are approaching private exchanges as part of e-commerce strategies shows their potential may very soon turn into reality. I encourage anyone interested in the intersection of insurance e-commerce, care delivery and care financing to read this insightful report.
