As stated in other posts, it continues to amaze me the changes in 2007 for the workers’ compensation PPO market. This week brought more changes.

From my discussions with many different people, it seems that Coventry has now entered a new strategy. What I am hearing is that they are now going to offer a “Super Network” (not a very creative name) consisting of Focus, Aetna, and Coventry. For this “Super Network” the payor will get all 3 networks but at a much increased price. We shall see if this ends up holding true, but it seems to be the understanding of a lot of industry people. I imagine we will all know much more after the National Work Comp Conference held next week in Chicago. Also, it sounds like the plan from my sources is for Coventry to cancel all of the reseller agreements they have in place to drive everyone to them as a total solution (thus cutting out all of the resellers including software companies and bill review companies). If this is the strategy, it will only work if they term all of the resellers.

PPO percentage of savings have just gone to low, so the market is about to adjust itself with Coventry’s plan if it holds true. In a sense, I think this is a good thing as PPOs can’t continue to offer full coverage at increadibly low prices. Payors always underestimate what it really cost to run a PPO.

Whatever the strategy ends up being, the payors just needs to understand that options exist like Prime Health Services. No one has to be cornered by Coventry or any other company. The free market always wins in the end. New companies will emerge and existing ones will rise to the top to take on the “super network”