What health plan leaders should know

1. Regulatory changes with the new administration

The new administration is exploring potentially significant shifts in healthcare policy. We are watching several potential changes, including:

• Proposals to make Medicare Advantage the default Medicare enrollment option which would create growth opportunities for health plans
• The Centers for Medicare & Medicaid Services (CMS) continued prioritization of transparency, with new rules set to streamline prior authorizations and introduce new API reporting requirements by 2026
• Reforms to the Affordable Care Act (ACA) and Medicaid expansion

2. Rising cybersecurity threats

Cybersecurity remains a critical priority as ransomware attacks in the healthcare sector surged in 2024, with the average breach costing up to $10 million. Beyond financial losses, organizations are seeing increased accountability at the executive level for cybersecurity failures.

Health plans must adopt a proactive approach that includes comprehensive risk assessments, asset inventories and strengthened vendor management practices to mitigate supply chain vulnerabilities. With cyber risks showing no signs of slowing, a robust, forward-looking cybersecurity strategy is essential.

3. The acceleration of value-based care

Value-based care continues to gain momentum with alternative payment models now accounting for 45% of total healthcare spending, a 4% increase from the previous year. As these models expand, health plans must focus on aligning value-based programs goals to provider and member incentives, addressing care gaps and leveraging actionable data to improve health outcomes and control costs. Investments in interoperability, risk capture and personalized member outreach will play an important role in delivering measurable results in value-based programs.

4. The impact of AI and emerging technologies

Artificial intelligence (AI) will continue to revolutionize healthcare operations, from claims processing and fraud detection to compliance monitoring and workflow automation. However, the rapid adoption of AI brings heightened risks, including ethical and compliance challenges. With some states introducing AI-specific regulations, health plans must establish governance frameworks to ensure responsible, compliant AI usage while capitalizing on its potential to drive efficiency and innovation.

5. Evolving member expectations and engagement

Members want a more personalized, seamless healthcare experience from their health plans. Advanced digital tools—such as provider search platforms, cost transparency resources, and care management are no longer optional but expected. Securing member data is also critical as trust is essential in retaining members and enhancing satisfaction. Research shows that higher member satisfaction correlates with improved retention and quality and STAR ratings, which impact health plan reimbursement, emphasizing the importance of a member-centric approach.

With the new administration in position, more changes will continue to roll out over the next few weeks and months. To stay in the loop about updates and changes, subscribe to our Health Plans mailing list.