Pursuit of an Integrated Delivery System Strategy
Client/Profile
A regional insurer in a competitive Mid-Atlantic market
Challenge/Situation
To support the insurer in defining a new, strategic approach to financing and delivering healthcare through the creation of an Integrated Delivery System (IDS). The health plan sought strategic planning services with financial projections for acquiring and integrating a provider network—physicians, hospitals, and ancillary providers—with its insurance operations to create a regional IDS.
Process
Veralon worked closely with a client project team to plan an approach to forming the IDS. After first identifying opportunities, we determined the costs of acquiring the necessary IDS components and the impact of having those components. We assessed how these acquisitions would affect insurance operations given improved care mechanisms and a new model of integrated delivery. More specifically, Veralon worked with the health plan to:
- Identify optimal approaches to pursue regional clinical integration through health plan physician acquisition, employment, and other methodologies
- Quantify the investment required to obtain the various components of an IDS, including the acquisition of a strategically important health system
- Develop prospective financial analyses for each entity based on historical performance, projected utilization, and various other market considerations
- Determine the impact of the proposed IDS on health plan utilization, payment rates, and membership, including how the creation of the IDS affects relationships with other providers in the market
- Articulate a new approach to operating the acquired health system within an overarching IDS vision, more generally.
Results
Conclusions from these analyses were integrated into an implementation plan, which Veralon developed in conjunction with health plan leadership. We formulated conclusions and provided the necessary analysis to support a board decision. The board approved the health plan’s effort to acquire the health system and creation of an IDS.