After a nationwide search, Sutter Health and Aetna announced Tuesday that they have selected health industry veteran Steve Wigginton to lead a health plan the two companies founded in June 2017.
“Steve is a respected leader with a proven track record of driving culture, growth and innovation in the health care industry,” said Kristen Miranda, Aetna’s market president for California, in a prepared news release. “Steve has a passion for creating a better health care experience for consumers, and a clear vision of what will make Sutter Health | Aetna successful.”
Wigginton, who ran Chicago-based Valence Health, will assume the helm at the Sutter-Aetna joint venture immediately. That means building a management team, securing regulatory approvals, finalizing product offerings, refining the sales strategy and developing a multiyear roadmap to build a more member-centric experience.
Aetna and other insurers have been teaming up with hospital companies around the nation to form joint ventures for several reasons: Insurers want to expand their market strength while hospital CEOs hope to get greater control over the size of premiums they will get. And, under the Affordable Care Act, payments will be based on performance rather than fee-for-service.
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Consequently, these new ventures are looking to improve the health outcomes for a large population at a lower cost than their competitors can offer. Some hospital companies have purchased insurance companies as a way of reinventing themselves for this new era, and others have tried to integrate insurance capabilities into what they offer. The latter strategy has led to some costly failures.
The new Sutter-Aetna venture comes after the not-for-profit has seen its operating income seesaw up and down annually over the last five years. The company will work with both employers that operate self-insured plans where they assume the risk of providing health-care benefits and with those entities who pay premiums to an insurance carrier as part of a fully insured plan. Its self-insured products will be ready to go as early as April 1.
“With this new joint venture, Sutter Health and Aetna are well-positioned to disrupt the status quo in the marketplace and further transform health care in Northern California,” said Phil Jackson, Sutter Health’s CEO of Health Plan Products, in the news release. “We look forward to Steve’s leadership as we jointly create a health care model that works to provide people and employers with access to simpler, more affordable care.”