Indemnity Plans And Growing Population Offer Opportunity For Pharma In North Dakota Nearly One-Third of North Dakota's Commercial Insurance Market Remains in Indemnity Plans as Oil Boom Boosts Population, According to a New Report from HealthLeaders-InterStudy
NASHVILLE, Tenn., July 24, 2013 /PRNewswire/ -- HealthLeaders-InterStudy, the leading provider of managed care market intelligence, identifies the popularity of indemnity plans and the oil-driven boom in population as opportunities for the pharmaceutical industry in its first-ever North Dakota Health Plan Analysis report. Indemnity plans, which are often dismissed as obsolete, are fee-for-service plans that allow the insured to choose their own provider. Such plans remain very popular in states like North Dakota, where the bulk of the population is more rural and points of access to care are separated by large distances.
HealthLeaders-InterStudy's newly released North Dakota Health Plan Analysis report maps out the trends, opportunities and challenges facing pharmaceutical companies doing business in the state. The report finds that indemnity plans are the second most popular plan model in North Dakota's commercial segment, capturing 28 percent of the commercial market and enjoying five percent market share growth between July 2011 and July 2012. The report also maps out how North Dakota, which is now second only to Texas in terms of producing oil, is enjoying a dramatic population increase in towns neighboring the Bakken Oil Reserve. The oil boom is affecting communities such as Watford City, with a population of 1,439 in 2000, and Williston, with a population of 12,540 in 2000, both of which are now seeking healthcare solutions for more than 40,000 transient residents in the region.
"The freedom of choice and fewer restrictions associated with indemnity plans allow pharmaceutical companies to take advantage of greater flexibility in formularies and pricing. In addition, the competition brought about by a growing economy will require Pharma to focus on their pricing strategies in order to take advantage of the oil-boom-induced growth," explains HealthLeaders-InterStudy Analyst Jacqueline Cavnar. "North Dakota is among several states with a wait-and-see position on many healthcare reform tenets, meaning that 2014 will not bring a large influx of covered lives. North Dakota defaulted to a federally-run health exchange, but will expand Medicaid, estimating an additional 20,000 residents eligible under the expansion. With so much uncertainty surrounding healthcare reform, North Dakota's indemnity plans and population boom will continue to provide steady growth opportunities for Pharma."
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