Captive Insight Vol I | Page 58
The Health
OF HEALTHCARE
Cayman’s long and successful history as
a domicile for healthcare captives translates
to an environment that is observant and
perceptive about the role a captive can
play in a healthcare organiation’s risk
management and financing strategy and
its enterprise risk management framework.
As such, we are playing close attention to
the current challenges being experienced by
USA healthcare providers, where a number
of trends are becoming apparent.
Consolidation is taking place at quite a pace, not only in
terms of mergers and acquisitions of hospitals and practices,
but also in the shift from physicians working independently
to becoming hospital employees, and the extension of
healthcare to population management.
Consolidation of hospitals will result in consolidation
of healthcare captives – we are seeing this already. Less
visible is the strength that a captive brings to its owner’s
growth strategy. When the value proposition to a potential
acquisition target that is not already self-insured includes
captive coverage, with its benefits of stable, affordable and
broader coverage etc, it becomes quite compelling.
In terms of an expanding employed physician base,
there certainly are challenges to achieving aligned risk
management standards, but these are not new to captive
owners and are manageable. From a claims standpoint, there
are obvious merits to aligning hospitals and physicians in
defence of a malpractice case.
The greatest potential for captive involvement in the
healthcare industry’s response to the Patient Protection and
Affordable Care Act (“PPACA”) is the ability to satisfy
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