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Summary Aetna has struck a deal to sell individual health insurance with Costco, the #6 retailer. The deal targets 9 populous states first with more to follow in 2012  While the deal lacks some of the levers of the very successful Walmart-Humana Part D deal, there is real potential for this channel to attract consumers if employers opt-out on a large scale Given that Aetna has some arrangements with Best Buy (the #9 retailer) and an established alliance with CVS (the #7 retailer), it looks like Aetna is building out a multi-prong big box retailer channel strategy; others may follow … Read More

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There have been some blog posts (here and here) about a discussion on payment reform at the Massachusetts Health Data Consortium last week. While I did not attend, the commentary is provocative and I would like to offer a few observations. The discussion included some critical perspectives on the prospects for implementing payment reform and whether its implementation will really bend the trend. My main point in response to the dialog is that payment reform needs to be understood as part of a dynamic trajectory, a multi-stage … Read More

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Summary Geographic barriers to provider competition are a headache for payers By importing capabilities, specialty franchising could help reduce some of the barriers to cross-geography competition It is too early to tell whether the recent Sarasota-Columbia is a good example of what franchising could do given the rapid growth in capacity for high-end cardiology in the area; it may be more about preserving network status and price point But payers should not assume the model will be a disappointing supplement to provider leverage: Instead, consider encouraging providers with differentiated outcomes (resulting in a differentiated cost profile) to explore franchising models … Read More