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Bringing collaboration into the market paradigm

R A Berenson

    Health Affairs (Project Hope)
    |January 23, 1999
    PubMed
    Summary

    Health plans can collaborate on quality improvement within antitrust laws. Purchasers demanding collaborative efforts are key to success in health plan competition.

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    Area of Science:

    • Health economics
    • Healthcare management
    • Antitrust law

    Background:

    • Market competition theory in healthcare assumes health plans differentiate on quality.
    • Historically, health plans have not prioritized quality as a competitive differentiator.
    • Antitrust regulations permit competitor collaboration for specific goals, including quality enhancement.

    Purpose of the Study:

    • To explore opportunities for competing health plans to collaborate on quality improvement.
    • To examine the role of antitrust laws in enabling or constraining quality-focused collaboration.
    • To identify the influence of purchasers on driving collaborative quality initiatives.

    Main Methods:

    • Analysis of market competition paradigms in the health insurance sector.
    • Review of existing antitrust legislation and its implications for healthcare collaboration.
    • Examination of the strategic role of purchasers in health plan negotiations.

    Main Results:

    • Antitrust laws allow for selective collaboration among competing health plans for quality improvement.
    • Specific opportunities exist for health plans to work together on enhancing care quality within legal boundaries.
    • Purchaser demand is a critical factor in the success of such collaborative quality efforts.

    Conclusions:

    • Collaboration on quality is feasible for competing health plans under current antitrust frameworks.
    • Strategic purchasing by organizations can incentivize and facilitate health plan cooperation on quality initiatives.
    • Overcoming barriers to quality-based competition may require coordinated efforts and purchaser leverage.

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