The healthcare industry encompasses four, interrelated sub-industries: the healthcare provider industry, the pharmaceutical industry, the medical device and equipment industry, and the health insurance industry. The health insurance industry, thanks to the Affordable Care Act and the increasing number of insured Americans, requires—now more than ever—the leadership and management of health administrators.
The health insurance industry operates two types of organizations: independent insurance companies and managed care organizations, both of which require healthcare experts who can oversee the many divisions housed within them.
Due to the sheer size of most health insurers, health administrators generally work in many different areas, whether it is underwriting, compliance, sales, or marketing. Their titles may range from health insurance specialist to senior director to managing director.
Careers at the Intersection of Health Administration and the Insurance Industry
Independent health insurance companies and MCOs rely on the expertise of health administrators to solve complex issues related to healthcare delivery and incorporate effective and innovative solutions. Some of these positions include:
Health Insurance Specialist
Health administrators working as health insurance specialists for managed care organizations develop, interpret, and implement healthcare financing policy. Their work includes analyzing health insurance policies, identifying trends in healthcare utilization, studying the private health insurance industry, and overseeing program evaluations.
Health administrators as health insurance specialists help health insurers adapt and thrive to meet industry changes. Their understanding of diverse registration requirements and information procedures allows MCOs to deliver effective healthcare.
Director, Performance and Risk Adjustment
Health administrators serving as health insurance directors in performance and risk adjustment manage and coordinate all activities within the performance and risk adjustment department. This includes overseeing the development, implementation, and ongoing management of the program to achieve optimal financial operations.
Job duties include:
- Creating and administering value-based programs and services for maximizing the financial success of service delivery approaches
- Developing and implementing contracts, budgets, policies, procedures, and performance improvement standards
- Evaluating operating results on a regular basis as to ensure goals and objectives are met
- Overseeing management practices, staffing levels, staff orientation, competency, and on ongoing education and development
Director, Health and Product Integration
Health administrators as directors of health and product integration manage MCO strategies used to market and deliver health solutions. This includes managing and analyzing the impact of population health and health productivity strategies and managing and achieving financial objectives through engagement, population health strategies, and program implementation.
Directors of health and product integration optimize the delivery of health products and services, provide direction on the potential impact of regulatory changes, and recommend strategic changes to capitalize on emerging opportunities.
Director, Risk Revenue
Health administrators working as risk revenue directors for health insurance companies provide risk revenue financial services and strategic proposals and programs that support strategic and tactical improvements to risk adjustment processes. These healthcare professionals ensure compliance with all applicable laws and regulations while serving as primary advisors of strategic direction regarding risk adjustment.
Degree Requirements for Managed Care Organization Administrators
Managed care organization administrators may come from a wide array of backgrounds, including healthcare, finance, business management, accounting, risk management, marketing, and economics. However, what most of these professionals have in common are graduate degrees in health administration.
A master’s degree in health administration has become a standard among health administrators, due to its competency-based education that addresses the organizational, legal, financial, political, and managerial aspects of health systems management. Master’s degrees in health administration prepare students for senior-level administrative positions in settings such as hospitals, health systems, managed care organizations, HMOs and in research and academia.
Institutions offer master’s degrees in health administration through a variety of schools or colleges; therefore, the title of the program will reflect the school or college that houses it:
- Master of Business Administration (MBA)
- Master of Healthcare Administration (MHA)
- Master of Public Administration (MPA)
- Master of Public Health (MPH)
Many of these programs also allow students to focus their health administration degree on a specific healthcare topic, such as:
- Healthcare marketing
- Health policy and finance
- Human resource management
- Managed care
- Informatics
However, all programs offer a similar, core curriculum designed to prepare students to become leaders in the delivery of healthcare:
- Critical issues in healthcare
- Ethical and legal issues in healthcare
- Financial management in healthcare
- Health information systems
- Healthcare economics
- Healthcare policies and systems
- Managing organizational change
Most of these graduate degrees in health administration require the completion of a capstone project that provides students with the opportunity to engage in in-depth study in a specific area of health administration.
Salaries for Administrators in Managed Care Organizations: What to Expect
Managed care organizations are among the best paying jobs for healthcare administrators, according to the Bureau of Labor Statistics (BLS). As of May 2020, the BLS reported an average salary of $118,800 for healthcare administrators, with senior-level administrators – those with extensive industry experience – earning about $195,630 during this time.
However, when salaries for these professionals are broken down by setting, BLS stats reveal that healthcare administrators working for insurance carriers earned an average salary of $161,030, placing HMOs, PPOs, and other managed care organizations among the top payers for healthcare administrators.
May 2020 Bureau of Labor Statistics salary and job market trends for medical and health services managers represent national data, not school-specific information. Conditions in your area may vary. Data accessed August 2021.
Resources for Administrators in Managed Care Organizations