https://mailchi.mp/9e118141a707/the-weekly-gist-march-6-2020?e=d1e747d2d8

The aggressive push among insurers to purchase physician practices—one that mirrors the vertical integration strategies pursued by hospital systems over the past few years—has some asking what the end game looks like for health plans.

A recent investigative piece from Kaiser Health News shows where this payer-physician integration might lead. Focused on the activities of UnitedHealth Group in the New Jersey Medicaid market, the article describes a move by the company’s insurance subsidiary, UnitedHealthcare, to shift the Medicaid beneficiaries it covers in its Medicaid managed care plan into physician practices owned by its sister subsidiary, Optum.

That effort is the target of a lawsuit brought by some physician practices in the state, who allege they are losing patients as a result of an attempt by UnitedHealthcare to “narrow” its physician networks by terminating their contracts. It’s an obvious, and clever, strategy on the part of the insurer, which likely hopes to capture savings and generate greater revenue by integrating insurance and provision of care.

But as the piece describes, it’s proving significantly disruptive to the care of many patients, who are losing access to physicians with whom they’ve built relationships with over time. Insurers have pursued these strategies less aggressively in their commercial and Medicare businesses, turning instead to referral management tactics like specialist steerage, mandatory pre-authorizations, and discounted rates instead of shifting primary care patients care.

But, as in many other aspects of care, it may be easier to implement such aggressive “management” techniques in the low-income population, because patients have so few alternatives to care. As vertical integration strategies play out on both the hospital and insurer sides of the industry, it’s worth paying attention to how “grand strategy” of the sort depicted in our map above plays out on the ground, in the lives of individual patients.