Value is Paramount for Healthcare Companies in California

Health Plans in California Look for Differentiation and Innovation to Drive Growth, According to New Health Plan Analysis from HealthLeaders-InterStudy

NASHVILLE, Tenn.--(BUSINESS WIRE)-- HealthLeaders-InterStudy, a leading provider of managed care market intelligence, reports that managed care organizations (MCOs) are looking to differentiate their products with value-based designs.

Commercial enrollment in California declined slightly for many MCOs during the first half of 2011. MCOs in the state are finding organic growth of their business difficult which is fueling differentiation and innovation through new plan designs, according to HealthLeaders-InterStudy.

For example, Anthem Blue Cross and Blue Shield of California has launched a line of commercial PPO products tied to its accountable care organizations and plans to expand such programs state wide. Blue Shield of California followed suit with its own ACO-based portfolio, which includes PPO and HMO options.

This could create an opportunity for drug companies that can emphasize the value proposition of branded drugs.

Other MCO strategies, such as high-deductible health plans, could limit these opportunities. Deductibles have long been a useful tool for MCOs to affect prescription drug utilization and cost. Health plans in California are upping the stakes by imposing higher deductibles on branded and non-preferred drugs. Brokers are beginning to see deductibles as high as $750 on individual policies where $150 had been the norm.

“As MCOs look for strategies to preserve enrollment and control costs, continued emphasis on prescription drug benefits is likely and higher deductibles on those benefits could increase generic drug utilization,” said Laura Beerman HealthLeaders-InterStudy Analyst.

More information can be found in the recently published California Health Plan Analysis report as well as the Executive Briefing entitled: “All eyes on California as Healthcare Reform Gears Up”. A copy of the Executive Briefing can be downloaded here:

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Kristi Guillemette, 781-993-2618
[email protected]
Decision Resources Group
Elizabeth Marshall, 781-993-2563
[email protected]

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