Will Managed Care Leadership Need a New Mentality?

Thousands of jobs are being added to the healthcare sector each month. That’s good news for the economy and the future of healthcare, but the job influx and reasons behind it have created industry-wide challenges—or opportunities, depending on your perspective.

This is especially true in the managed care arena, says Steve Kratz, senior partner and head of Witt/Kieffer’s Managed Care practice. Writing in August’s issue of Managed Care Outlook – “How Managed Care Leaders Can Cope with Growth and Disruption” (subscription required) – Kratz cites four key trends that he is witnessing as managed care grows and its paradigm shifts:

  1. Experienced Execs are Leaving the Fold
  2. Insurance Business Models are Transforming
  3. Medicare and Medicaid are More Intriguing
  4. The End-of-Life Care Market is Ramping Up
Steve Kratz

Steve Kratz

Experienced leaders leaving managed care is concerning, since the sector is expanding while the leadership challenges are multiplying. However, this should be welcome news for up-and-coming mid-level managers. As the top ranks open up, a new generation will need to fill the void, Kratz notes.

These leaders face challenges such as the complicated implementation and ramifications of the Affordable Care Act. Kratz points out that, “as health insurance becomes more heavily regulated . . . the traditional business-to-business sales model is gradually giving way to one oriented more toward business-to-consumer.” Health insurance leaders, therefore, need to have more of a consumer-driven mentality plus expertise in both private and public insurance markets.

The uptick in baby boomer retirement is also having an impact on organizations’ corporate strategies. Prominent insurance companies are launching and beefing up Medicare Advantage and Medicaid offerings, realizing that there is a large market emerging despite the tough operating margins. Which leads to the point that end-of-life care is ramping up. Medicare and Medicaid are spurring a trend of insurers like Aetna and Humana moving toward palliative care and hospice. A key trait for successful leaders will be an appreciation for the nuances and potential of end-of-life care.

Overall, this is a heavy amount of change to tackle but also opportunity. “In the new integrated environment in which providers and insurers are joining forces toward improved population health, those executives who can break down silos and reach across disparate functions will have an advantage,” says Kratz. Managed care providers are seeking to infuse their leadership ranks with executives who bring more creativity and consumer-focused mindset to their organizations.

By Brianna Scharfenberg, Communications Assistant

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Guide to Healthcare Succession Planning


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