Looking back at 2018, one of the developments that most caught my attention was the number of “mega-collaborations” between health systems and health plans. These collaborations are changing how care is delivered, and coupled with the just released Medicare ACO risk rules, will have more importance in the year ahead (see CMS Finalizes “Pathways to Success,” an Overhaul of Medicare’s National ACO Program). And, this shift brings great opportunity and great peril for specialty provider organizations serving consumers with complex needs. These collaborations have taken many forms.

There is the merger and acquisition model of provider organizations:

This past year, Humana acquired Kindred (see Kindred HealthCare Sold To Humana & Equity Firms For $4.1 Billion); and more—Humana Acquires Family Physicians Group In Central Florida and Humana & The Consortium To Buy Curo Health Services For About $1.4 Billion, Humana & Vancouver Clinic Announce Two New Primary Care Clinics To Provide Access For Medicare Advantage Beneficiaries, and Humana Partners With Walgreens To Provide ‘Senior-Focused’ Primary Care In Missouri.

Centene announced it had signed a definitive agreement to acquire Community Medical Holdings Corporation (see Centene To Acquire Community Medical Group To Expand Its Provider Assets). Anthem announced it had entered into an agreement to acquire Aspire Health (see Anthem To Buy Aspire Health, A Community-Based Palliative Care Organization). UnitedHealth and its subsidiary Optum were active in the acquisition space—UnitedHealth Acquiring Four Clinics Through Its Purchase Of Peoples Health, UnitedHealth’s Optum To Acquire A Stake In The Polyclinic, Sound Physicians Sold To Optum & An Investment Group Led By Summit Partners, and UnitedHealth’s Optum Expands Urgent Care Business In Texas. And, dominating the health care news was the completion of the $69 billion acquisition of the health insurer Aetna by CVS (see CVS Health Completes Aetna Acquisition).

There were announcements of new types of ACO agreements including:

1. Regence BlueCross BlueShield Of Utah & Aledade Partner To Expand Innovative Value-Based Care Model
2. UChicago, Humana Strike Value-Based Care Partnership
3. Aetna Collaborates With Community Care Of North Carolina To Deliver Integrated Care To State Medicaid Beneficiaries
4. Trinity & Six Independent Hospitals Form Aetna ACO
5. Community Care Physician Network, UnitedHealthcare Partner To Serve Medicaid Beneficiaries In North Carolina
6. Cape Fear Valley, UnitedHealthcare Launch Medicare Advantage ACO
7. Trinity & Six Independent Hospitals Form Aetna ACO
8. Regence BlueCross BlueShield Of Utah & Aledade Partner To Expand Innovative Value-Based Care Model

And, there were other types of experiments in collaboration. There are new co-branded health insurance offerings—Cleveland Clinic Launches Co-Branded Medicare Advantage Plans With Humana and Mayo Clinic & Medica To Launch Joint Insurance Plans. There are also initiatives that target specific consumer groups—Blue Cross North Carolina, Landmark To Deliver Home-Based Medical Care To Consumers With Complex Chronic Conditions, Care1st Health Plan Arizona Signs Value-Based Agreement With Equality Health To Offer An Expanded Network & Culturally Competent Services, Children’s Hospital Colorado & Anthem Launch Pilot Child-Focused Value-Based Program, and Aetna & Betty Ford Partner With Kenton County, Kentucky On Jail Reentry Program.

And, I expect the number and depth of these types of health system/health plan collaborations will speed up with the recent CMS announcement changing the rules regarding Medicare Shared Savings ACO financial risk (see Fact Sheet: Final Rule Creates Pathways to Success for the Medicare Shared Savings Program). Essentially, the new rules limit the amount of time an ACO can operate under a shared savings model from six years to three years. Additionally ACOs will be able to offer telehealth services and beneficiary incentives for healthy behaviors. (We’ll have more in-depth coverage of the new rules in an upcoming article.)

For specialty provider organizations, this raises great opportunities and presents some tremendous market threats, depending on what consumers the organization serves and what geographic markets the organization is located in. The health system/health plan collaborations represent “uber integration.” Integration of services—both vertical and horizontal—combined with fiscal integration. For most specialty organizations, I think the emerging available market positioning falls into two areas – “whole person” care coordination and/or providing admission diversion/readmission prevention for high-need chronic and complex populations.

As we move into the new year, the executive teams of specialist organizations need to be aware of the big moves by the big players in their market—and have plans for where to “fit” in the value chain as it morphs. (The situation brings to mind my oft-used adage, “you can’t help but notice when elephants roll over.”) It’s all about strategy and anticipating the strategic scenarios that can rapidly change competitive advantage and sustainability. In my last piece for 2018, I want to wrap with some thought-provoking pieces on organizational strategy for the new year:

1. The “M” Word In Health & Human Services Strategy-Why Marketing Should Be Part Of The Everyday Conversation
2. How To Develop A Successful Marketing Plan: The OPEN MINDS Guide To Marketing Strategy
3. Using Virtual Care To Improve Your Value Proposition: Best Practices In Integrating Technology Into Your Community-Based Program
4. Building & Executing Strategy In A Complex Market-A Three-Phase Best Practice Model For Success
5. Are Health Plans Your New Competition?
6. Understand Your Data, Make Decisions Quickly & Fail Fast
7. Taking The Risk On A New Service
8. Fitting Specialty Care Into ACOs
9. Five Keys To ‘Partnering’ With Health Plans On Social Determinants
10. Pay For Value-The Glass Half Full, The Glass Half Empty?
11. Preparing For The Very Glacial VBR Rollout In Some Markets

And, on behalf of our OPEN MINDS team, I want to thank the 154,000+ readers of the OPEN MINDS Circle—and wish you all a peaceful and prosperous new year!