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New Care Models: How Health and Life Insurers Can Rise to the Challenge of Older and Sicker Societies

Authors:

Nicholas Goodwin ,

Department Of Human Ecology And Department Of Family Medicine, University Of Alberta, CA
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Adrita Bhattacharya-Craven

Department Of Human Ecology And Department Of Family Medicine, University Of Alberta, CA
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Abstract

Introduction: Demographic and epidemiological shifts have made age-related and chronic illness a large part of healthcare expenditure. Episodic hospital and speciality care dominate in most health systems. Yet the shifts in consumer needs warrant a greater convergence of all levels of health and social care to improve consumer experience, health outcomes and cost inflation. Unlike traditional care approaches, New Care Models (NCMs) seek to better coordinate these three elements to meet the so- called ‘Triple Aim’ objectives.

Aims and Methods: This paper provides the findings from a research report that sought to examine how health and life insurers can adopt NCMs to influence care at all life stages seamlessly and to keep cost in check. It is organised in three parts:

•an outline of the evidence for NCMs on health and cost outcomes, based on a non-systematic literature review;

•a summary of key insights from 15 high-level interviews with key informants from the health and life insurance industry; and

•implications for the future of the insurance sector derived from the literature review and interviews.

Key Findings [1]: There is good evidence that NCMs can support improved care experiences, favourably influence health outcomes and limit the rise in costs of care. The advent of Accountable Care Organisations (ACOs) has been associated with financial savings of between 6–25% when compared to standard practice. In part, this success has been as a result of new insurer/payer and provider models that support risk-sharing arrangements. However, varying implementation contexts make it harder to infer how consistently positive results can be generated.

Interviews with stakeholders demonstrated a limited move towards the uptake of new governance and contracting models that might support NCMs. Specifically, consumer and provider benefits of NCMs needed greater articulation whilst the transactional nature of traditional distribution channels acted as a barrier to diversification. Interviewers recognised the need for service innovation, but pointed to a need to address regulatory environments, data integration, risk-averse leadership cultures, and payment reform.

Conclusions: Insurers need to go beyond simplistic notions of choice and convenience to promote value to consumers, distributors, and providers. Insurers need to become ‘strategic payers’ to ensure favourable supply-side conditions, share risks, and shift towards value-based payments. A cradle-to-grave joint health-life service proposition should be encouraged.

Implications: By moving away from being a passive claims processor to become a ‘strategic payer’, insurers can correct the common misalignments found between financial flows and provider incentives. Many of these purchasing approaches reward value over volume by balancing care between costly hospitals and speciality clinics and less costly primary/community-based settings.

 

References:

1.Bhattacharya-Craven A, Goodwin N (2021) New Care Models: How Insurers Can Rise to the Challenge of Older and Sicker Societies, The Geneva Association, Switzerland available at: https://www.genevaassociation.org/research-topics/health-and-ageing/new-care-models

 

How to Cite: Goodwin N, Bhattacharya-Craven A. New Care Models: How Health and Life Insurers Can Rise to the Challenge of Older and Sicker Societies. International Journal of Integrated Care. 2022;22(S3):14. DOI: http://doi.org/10.5334/ijic.ICIC22006
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Published on 04 Nov 2022.

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