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Allina Health, Aetna Working Collaboratively in Joint Venture

Analysis  |  By Christopher Cheney  
   May 19, 2021

Allina Health and Aetna still negotiate reimbursement for the health system's services but they bargain as amicable partners.

The Allina Health | Aetna health plan joint venture is capitalizing on its parent organizations' resources and a collaborative spirit, a pair of top executives say.

There are three primary types of "payvider" healthcare organizations. A healthcare provider can establish its own health plan. A healthcare payer can establish its own provider division. And a healthcare provider and payer can come together in a joint venture.

The Allina Health | Aetna joint venture was announced in January 2017, and it began offering fully insured and self-insured products in early 2018. Aetna is a division of Woonsocket, Rhode Island—based CVS Health. The joint venture has forged a collaborative relationship between Minneapolis-based Allina Health and Aetna, says Richard Magnuson, MBA, chief financial officer of Allina.

"We work in ways that align incentives that are more collective and in ways with more shared-risk models, so that you are jointly working together to ensure that what is best for the patient is best for both Allina and Aetna. It takes leadership from all sides to come at this with a different mindset," he says.

The joint venture has succeeded in stepping away from the traditionally contentious relationships between providers and payers, Magnuson says.

"Where the industry has been in the past—and it is not going to work in the future—is my job as the provider is to get as much from the payer as possible and get rewarded every time I do something with a member. In the past, the health plans have tried to reduce what they pay the provider and to put administrative hurdles in place for the provider to get paid. What that does is create a lot of administrative non-value-added work," he says.

In the joint venture, there is still negotiation over reimbursement for Allina's services, but the negotiation does not happen from a point of conflict, says Tom Lindquist, MBA, CEO of Allina Health | Aetna, which is based in St. Louis Park, Minnesota.

"The negotiation happens in the context of what is going on in the environment—what is happening with medical cost trends, what is happening with the overall health cost environment, and what we need to do to make the negotiation a win-win situation while holding costs as low as possible for the individuals we serve. That is the primary difference—no one side of the negotiation is trying to one-up the other. It is about finding the best landing spot so we can go about the business of the business, which is improving health outcomes, medical care, and patient experience," Lindquist says.

Sharing resources

The joint venture has been an effective vehicle for sharing resources between Allina and Aetna, Magnuson says.

"We have some collaborative clinical teams that work on opportunities to meet the care needs of our patient population. So, we bring together our clinical folks and their clinical folks on a periodic basis to help address those needs. From a data perspective, we can bring together data from the care side and the payer side in a way that helps us understand the patient as a person. If we were just a payer or provider, we could not do that. Lastly, we bring together a small group of our administrative teams to help work through issues from each of the owners' perspectives," he says.

The administrative teams meet regularly, Magnuson says. "About every six weeks, a couple of my Allina colleagues and I, some of the Aetna folks, and some of the joint venture folks come together on issues such as product design. We come together to create product design that meets the consumer's needs, Allina's needs, and Aetna's needs."

Allina and Aetna have shared resources in a recent Medicare initiative, Lindquist says. "In our Medicare program, we developed a complex-care-for-seniors initiative. We worked with both the Aetna infrastructure and the Allina clinical team to develop the program. It is going to utilize extra resources and clinical care from Allina along with the educational resources and outreach technology from Aetna to help improve results for the most vulnerable within the Medicare population. That initiative kicked off in January of this year."

Keys to joint venture success

Lindquist and Magnuson say there are several factors involved in achieving joint venture payvider success.

  • There must be willingness among the provider, payer, and joint venture organizations to have open, honest, and frank discussions about the business, where it is going, and what they want to accomplish. "Just like any joint venture, you need to keep the dialogue going," Magnuson says.
  • The payer, provider, and joint venture organizations must make sure that their goals are aligned.
  • There needs to be flexibility. "With the coronavirus pandemic, the changes have been incredible. So, the ability to be flexible is critical," Lindquist says.
  • You need to think about the joint venture in unique and different ways—not just coming at the joint venture from a payer lens or a provider lens.
  • You need to come together and collectively come up with more affordable and effective care in a way that you probably cannot do on your own.
  • You need to be open to seeing things from the other organization's perspective.
  • The payer and provider organizations need to listen and learn from each other.
  • The joint venture needs to be able to align around patients in a way where traditional incentives have not worked in the fee-for-service world. "You need to come together in a way that is best for the patient," Magnuson says.

Measuring joint venture performance

The Allina Health | Aetna joint venture has focused on several metrics to measure success, Magnuson says.

"Similar to most health plans, a key metric in the joint venture is about membership and how many members you are providing care for. From Allina's perspective, we watch how many members are attributed—how many members are getting their care from Allina. So, the joint venture wants to see growth overall and as much care as possible being provided by Allina. Patient satisfaction and engagement are also critical," he says.

Related: Shoulder-to-Shoulder: Why This Payer-Provider Partnership Spurned Vertical Integration

Christopher Cheney is the senior clinical care​ editor at HealthLeaders.


Joint venture "payviders" require open and honest dialogue between the provider and payer partners.

Providers and payers in joint ventures can share data to understand the patient as a whole person.

The Allina Health | Aetna joint venture includes collaborative clinical teams that work on opportunities to meet the care needs of the patient population.

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