Scan Group and Sutter Health are launching a new Medicare Advantage company that blurs the payer-provider line.
The healthcare companies will invest undisclosed sums to create a new, nonprofit entity focused on developing technology, co-branded Medicare Advantage plans and care models targeted at the 6.9 million eligible Medicare enrollees in California. Scan Group and Sutter Health plan to unveil new private Medicare plans over the next three years, beginning in the fall. The joint venture will launch in 2026.
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The collaboration represents the first time Sutter Health has formed a joint venture with a Medicare Advantage insurer, President and CEO Warner Thomas said. The Sacramento, California-based nonprofit system operates a health plan, but it has traditionally focused on commercial enrollees.
“11,000 people age into Medicare every day and about half of them, nationally, go into Medicare Advantage. This is just going to become an increasingly large part of healthcare,” Thomas said.
Last December, Sutter Health hired former Cigna executive Aparna Abburi to head their side of the venture, Thomas said. Scan Group President of Medicare Karen Schulte will lead their portion.
The companies began discussing a possible joint venture last April, said Scan Group CEO Dr. Sachin Jain. The nonprofit insurer counts more than 300,000 Medicare Advantage members across five states.
“This is the first time Scan has done anything like this, and we think it might represent the future of Medicare Advantage,” Jain said.
Healthcare providers and Medicare Advantage insurers usually butt heads over prior authorization requirements, claim denials and reimbursement delays. Joint ventures between the two are rare, but some have been able to find common ground. In 2020, Hackensack Meridian Health formed a Medicare Advantage joint venture with Horizon Blue Cross Blue Shield of New Jersey called Braven Health.
Scan and Sutter's joint venture comes as low federal reimbursements, stringent audits, tightened Star Rating quality reviews and a marketing crackdown roil the industry. In recent years, insurers have also struggled with rising medical expenses. But Medicare Advantage might be on the upswing.
Insurers are cautiously optimistic about President Donald Trump's administration’s view of the program after regulators recently announced the highest annual rate increase in at least a decade for 2026.
