UnitedHealth Finds Success in Las Vegas With Sierra Health Plan Model

Insurer Able to Keep Las Vegas Market Premiums Lower Than Competitors' Because of Integrated Structure, According to New Report from HealthLeaders-InterStudy

Jan 07, 2010, 08:00 ET from HealthLeaders-InterStudy

NASHVILLE, Tenn., Jan. 7 /PRNewswire/ -- HealthLeaders-InterStudy, a leading provider of managed care market intelligence, reports that while health insurance premiums are rising in Las Vegas and across the country, UnitedHealth Group's unique, integrated structure in Las Vegas has enabled the insurer to keep premiums lower than other health plans in this market. Following its 2008 purchase of Sierra Health Services, UnitedHealth leads the market in managed care enrollment and also owns the area's largest multispecialty physician group, Southwest Medical Associates.

According to the recent Las Vegas Market Overview, UnitedHealth has achieved this dominance by maintaining plan models Sierra had in place prior to the merger that include its affiliated physician group. For instance, with its Health Plan of Nevada HMO, even though the insurer does not limit its network in the Las Vegas market to its own facilities, or charge a higher in-network rate to members who choose non-affiliated care, most members do choose Southwest Medical for their care, which enables UnitedHealth to manage costs through integrated patient care.

UnitedHealth can also control drug costs with the aid of Southwest Medical's electronic medical record system, including its extensive use of electronic prescribing, which enables UnitedHealth to track physician prescribing.

"It's not unusual for UnitedHealth to be an influential player in a market, but its dominance in Las Vegas as the result of owning a large physician group is rare for the insurer. Additionally, UnitedHealth has maintained Sierra's model following the merger, changing little about how plans are run. This has not typically been its strategy in other markets. For example, when it acquired PacifiCare in California, the plan was integrated into the UnitedHealth model," said Taylor Holliday, analyst with HealthLeaders-InterStudy. "With its own physician group making up the core of its physician network, UnitedHealth operates almost like a staff-model HMO in Las Vegas. It appears to be a model that is working because UnitedHealth is looking to open Southwest Medical locations in Arizona, as well as expand this delivery model to other markets."

Why Pharmaceutical Companies Need Market Overviews

Market Overviews provide a detailed analysis of local healthcare market drivers in 87 of the nation's most dynamic metro areas, allowing pharmaceutical executives to quickly gain local area expertise. Each report provides local-level insights into: health systems and hospitals, physicians, health plans, Medicare/Medicaid, pharmaceutical environment, legislation and employers.

About HealthLeaders-InterStudy

HealthLeaders-InterStudy, a Decision Resources, Inc. company, is the authoritative source for managed care data, analysis and news. For more information, please visit www.HL-ISY.com.

About Decision Resources, Inc.

Decision Resources, Inc. is a cohesive portfolio of companies that offers best-in-class, high-value information and insights on important sectors of the healthcare industry. Clients rely on this analysis and data to make informed decisions. Please visit Decision Resources, Inc. at www.DecisionResourcesInc.com.

All company, brand or product names contained in this document may be trademarks or registered trademarks of their respective holders.

    For more information, contact:
    Lisa Osgood                      Elizabeth Marshall
    HealthLeaders-InterStudy         Decision Resources, Inc.
    781-296-2606                     781-296-2563
    losgood@hl-isy.com               emarshall@dresources.com

SOURCE HealthLeaders-InterStudy