Healthcare providers first began testing the waters with their own insurance plans in the 1990s. Now, with the industry transitioning toward value-based care, the phenomenon is surfacing once again. Providers leveraging their own health plans, often in collaboration with outside insurers (see the CVS-Aetna merger), purport to drive competitive advantage in an already saturated market.

But the significant differences between value-based and fee-for-service require a careful approach. 3m, the Minnesota-based science and research conglomerate, suggests five actions that providers can take to overcome common hurdles to maintaining successful provider-sponsored health plans in the new value-based ecosystem. They are:

1. Provide payment incentives. Bundles and shared-savings are two potential avenues for boosting compliance and balancing quality outcomes with cost-controlled care provision.
2. Focus on the continuum of care. One of the main tenets of value-based care is that treatment does not end when the patient leaves the hospital. Follow-up appointments, ambulatory care, rehabilitation and other aspects of treatment are all linked in the value-based ecosystem to provide the most value for the patient and provider.
3. Facilitate population health management. Evidence suggests that successful population health efforts reduce readmissions and cut unnecessary costs by keeping at-risk patients out of the hospital and focused on preventive care.
4. Use data analytics to manage risk. Strong analytics aid in population health management as well as in forecasting industry trends.
5. Create an established healthcare technology infrastructure. Provider-sponsored plans often fail due to lack of infrastructure or mismanaged resources. Efficient and effective data sharing augments operations from the examination room to the boardroom.

3m also proposes that the ability for providers to set their own guidelines and plans for implementing value-based care systems provides a gentle learning curve, highlighting more effective implementation at a reasonable rate of change. And while there is not an an extraordinary number of providers taking the plunge, it is growing every year:

“In the last two years, the number of these plans has doubled to nearly 300, as reported by the 2016 Directory of Health Plans by Atlantic Information services. Fifty percent of U.S. health systems have applied, or intend to apply, for an insurance license, according to PricewaterhouseCoopers.”

For more information, read the full report from 3m here.