The UnitedHealthcare Business Model; Comparison with Roche and Siemens

The New York Times of September 16, 2010, carried a full page ad sponsored by UnitedHealthcare. I have posted a number of previous notes about this large company, some of which have not been very flattering. Emblazoned across the midriff of a running woman in the ad is the following slogan: Knowledge in numbers, Strength in numbers, Humanity in numbers, Comfort in numbers, Health in numbers. Get it -- the business model for UnitedHealthcare must have something to do with numbers, as in the management of administrative, financial, and clinical data in healthcare. The company's web site is HealthinNumbers. I am not exactly sure with whom this motto resonates, but let's move on. About a month ago, Mr. HIStalk opined about UnitedHealthcare from an investor's perspective (see: Healthcare IT from the Investor’s Chair 8/23/10). Here is an excerpt from his long piece:

Ingenix, as all likely know by now, is the wholly-owned IT subsidiary of UnitedHealth Group, one of the largest publicly traded managed care companies. Mr. HIStalk himself recently posted a list of its recent buys. The first thing that’s noteworthy to me is its dramatic movement from only managed care-focused companies — such as Symmetry, Claredi, or AIM — towards first the hospital business office (CareMedic, Executive Health Resources) and then towards the clinical side of the healthcare system (Picis and, most recently, Axolotl). When Ingenix tried to buy managed care claims system vendor TriZetto a few years ago, it was going to make the questionable bet that its competitors would purchase their core systems from them. A stretch, but one with precedent. Now it’s betting that hospitals and physicians will not only pay real money to the Great Satan of Managed Care, but that they’ll entrust their clinical data to it as well.

In my note yesterday, I described the business models of both Roche and Siemens, each with critical links to diagnostics (see: Evidence that Roche Is Distancing Itself from the Traditional Pharma Business Model). Using abbreviated phrases, the first can be described as companion diagnostics & personalized medicine. The second can be referred to as integrated diagnostics. I now cite a third healthcare business model that I see emerging, which is that of UnitedHealthcare. I would describe this third model as information & health insurance. From the perspective of pathology, there is a very real difference between these first two models and that of UnitedHealthcare. In my opinion, Roche and Siemens view pathologists, radiologists, and lab medicine physicians as customers and key allies. They are the purchasers of analyzers, imaging equipment, and digital pathology scanners, and software. They are also the major drivers of the healthcare diagnostic enterprise.

UnitedHealthcare, on the other hand, views large health systems as suppliers and the U.S. government, corporations, and perhaps individual citizens, as its customers. They are the purchasers of health insurance and of health related services. The company views physicians as interchangeable cogs in the system and will not hesitate to bully them to in the pursuit of profits (see: UnitedHealth Moves Spark "Doc Fight"). Health systems are consolidating in order to gain more negotiating power vis-a-vis large insurance companies like UnitedHealthcare (see: Health Systems Use Their Regional Dominance to Muscle Insurance Companies). All of these three business models will certainly coexist, given the size of the large and profitable companies that are pursuing them. I compare them here in order to alert lab professionals to where I think their best interests lie.

Comments

[worldfortoday]

I think UnitedHealthcare try to get comparison what they targeted with what they achived

[Caverta]

Well elaborated.. The comparison is not an unique word to focus upon, but is an better enclosure to know what they had achieved.