Marissa Plescia , 2025-04-15 22:01:00
There has been growing tension between health systems and Medicare Advantage plans in recent years, with some health systems cutting ties entirely with MA plans. This has partially been due to administrative challenges and high rates of claims denials.
But last week, an MA insurer and a health system announced that they are coming together. SCAN Group — which offers MA plans — is partnering with health system Sutter Health to create new MA products in Northern California, and eventually build a joint venture MA health plan. SCAN serves 300,000 members in California, Arizona, Nevada, Texas and New Mexico, while Sutter Health has 57,000 staff and clinicians and 12,000 affiliated physicians throughout California. Both are nonprofit organizations.
In the fall, there will be new SCAN MA products in Northern California that offer access to Sutter’s network of hospitals, doctors, urgent care centers and other services. Members will also receive support from a Sutter primary care clinician.
Then in the “near future,” the organizations will co-own and co-design an MA plan, according to the announcement. SCAN and Sutter will work together on building the plan’s network, benefits and products.
“This collaboration is just the beginning of our efforts to innovate and improve care and experience for our patients with Medicare Advantage,” said Conrad Vial, M.D., SVP and president of Sutter Health Network, in a statement.
Being co-owners of the plan will address many of the issues that currently exist between a lot of MA insurers and health systems, declared Dr. Sachin Jain, CEO of SCAN Group and SCAN Health Plan.
“A lot of Medicare Advantage contracting relationships are entered into non-transparently,” he said in an interview. “What I think ends up happening is that, over time, plans will engage in a lot of denials of services. Plans may introduce new benefits, but then charge the cost of those benefits to the provider partner in value based care arrangements. … [In the partnership], we own this plan together, so everything is going to be transparent. This isn’t us owning a plan and them being the provider partner to the plan. Of course, they are going to be the provider partner to the plan, but they’re also going to be owners of the plan.”
As co-owners of the plan, SCAN and Sutter Health will be jointly contributing to the expenses associated with the plan, as well as sharing in the profit or losses of the plan, Jain added.
While the partnership is starting in Northern California, the new health plan could expand beyond this region in the future, according to the announcement. In addition, Jain aims to have tens of thousands of members in the plan in the next few years. Otherwise, “we won’t have done our job,” he said.
He also hopes to form similar partnerships with other health systems in the future.
“The Medicare system writ large needs an overhaul, but our job in the meantime is to really make the most of the Medicare Advantage system,” Jain said. “Because I think it ultimately creates the greatest opportunities for us to align what’s good for patients and what’s good for the healthcare system. Our goal is to really demonstrate the art of the possible. And my hope is that in executing this with Sutter, we will inspire other health systems around the country to want to do this with us as well.”
This isn’t the only MA insurer/health system joint venture. For example, Hackensack Meridian Health, Horizon Blue Cross Blue Shield of New Jersey and RWJBarnabas Health have a Medicare Advantage plan together called Braven Health that launched in 2020.
SCAN has also launched several other partnerships in recent years. In October, it began offering a Medicare Advantage plan tailored to the Asian older adult population, in which Astrana Health is the main provider. SCAN also has a health plan geared toward LGBTQ+ seniors in partnership with Included Health.
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