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Providers and Payers Make Good Bedfellows

Christopher Cheney, for HealthLeaders Media, February 26, 2014

As health systems across the country look for ways to adapt to a changing marketplace and a wave of federally driven reform efforts, Sanford Health is enjoying the benefits of a strategic leap it took nearly two decades ago.


Punch and Judy show

The evolution of provider-payer relationships is one of the great mysteries of healthcare reform efforts in the United States. Built on mutual need, these two parties have evolved from politely tolerating each other to something that lately has more closely resembled a Punch and Judy show.

But these relationships continue to evolve. What was once unthinkable is now trending upward. Some health systems are launching their own health plans while others are considering partnering with payers to offer in-house health plans.

Ruth Krystopolski knows what they are facing. And the South Dakota-based health plan executive knows what they stand to gain. "The health plan became a central depository," Krystopolski, president of Sanford Health Plan in Sioux Falls, told me last week. "It collected [valuable] information from a variety of sources."

Sanford Health began offering insurance through its partner health plan in 1998, starting in the health system's established market in Iowa, South Dakota and Minnesota, says Krystopolski, who helped craft the plan.

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