Long-term care providers selling health insurance? Don't laugh
Around Louisville, Signature HealthCARE is known as a high-end provider of skilled care services. Starting next month, it will also begin selling health insurance.
As unusual as that might seem, it may not be long before additional operators are following suit.
Signature's portfolio expansion is actually a joint venture with AllyAlign Health, a risk-management firm.
Signature President and CEO Joe Steier sees several compelling reasons for the move.
For one, having its own insurance firm lets Signature have a better relationship with the docs.
For another, the insurance industry is continuing to push down payments for providers like Signature, and this is a bulwark against that trend.
Finally, there can be a huge financial upside for long-term care operators that are willing to get into the risk-management business.
So will other providers soon be adding insurance firms to their portfolios? It's probably too soon to tell. Lord knows plenty of insurers have been running away from this sector for the past two decades.
But it does feel a bit different this time. And by essentially removing a middleman, there's a good chance that a more operators may soon feel like they are actually in control of their own destiny.
It would sure seem to be a better alternative than the managed care squeeze play so many other operators appear to be bracing for.
John O'Connor is McKnight's Editorial Director.