More Health Systems Launching Medicare Advantage Plans; Cavulus Weighs In


By: Patrick Phillips, Founder & CEO, Cavulus

Earlier this month, Lumeris published a new study stating 27 percent of major U.S. health systems plan to launch a Medicare Advantage plan in the next four years. The survey also found that only 29 percent of respondents felt confident in their system’s ability to do so. We asked Patrick Phillips, Founder & CEO of Cavulus, a portfolio company of UPMC Enterprises, for his take on the recent findings.

“Twenty-seven percent of major health systems entering the Medicare Advantage (MA) market is encouraging, but frankly, we’d like to see that figure increase. Value-based integrated health systems are the future of health care delivery in the U.S., and it’s a model we advocate.

Health systems committed to wellness, prevention, and efficient care will gain significantly by taking this risk.

However, the reluctance is understandable. It’s critical to quickly grow a membership base in order to offset losses from insurance payments earned in the “pre-integrated” approach. Members won’t distinguish between the network’s medical and insurance entities, so any misstep in the health plan’s infancy will impact the entire organization. There’s no room for error or delay along the learning curve.

Seek out trusted Medicare Advantage expertise, at the very least, to guide the launch and establish efficient processes. The build vs. buy evaluation regarding operations and technology infrastructure is simple: buy it. In our 12+ years of designing workflow solutions for MA plans, it’s astonishing to see the consequences of poorly planned technology infrastructure. Vet third parties for demonstrable and substantial MA experience; a background in commercial insurance isn’t sufficient.

Lastly, some regional, university-affiliated and provider-owned integrated health systems outside of your territory may share their insight and experience. Even if a health system is four years away from their CMS filing, they should be laying groundwork and engaging potential partners now.” – Patrick Phillips, Founder & CEO Cavulus

To read more about the report visit, Healthcare Finance or Lumeris.

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