Health plans are investing heavily in analytics and artificial intelligence (AI) but are they getting the results they need? That was the central question at Milliman MedInsight’s June 18th webinar: Data-Driven Payer Strategies: Survey Insights and Solutions. Presenters Marcos Dachary (Milliman MedInsight Principal, Chief Market Strategist and General Manager of Payer Solutions), Lauren Piacentini (Milliman MedInsight Director of Payer Analytics), Christopher Kunkel (Milliman Principal and Consulting Actuary), and moderator John Stewart (Milliman MedInsight Senior Enterprise Account Manager) shared findings from the 2025 Milliman MedInsight (MedInsight) Payer Market Survey alongside a roadmap for turning analytics investment into measurable margin impact.
If the data surfaced one overriding theme, it’s this: the gap between what payers know they need and what they can actually execute is wide and growing more costly by the day.
Why the urgency is real right now
In Medicare Advantage, Risk Adjustment Data Validation (RADV) audits are now annual and mandatory on every product, leaving plans with undisciplined risk adjustment processes genuinely exposed. Duals growth remains the top strategic focus for most MA plans, while STARS cut-point pressure intensifies quarter by quarter.
On the Medicaid side, a 50% value-based care (VBC) participation target by 2030 is on the horizon, and Medicaid work requirements starting December 31, 2026 will create membership volatility that demands FFS-level visibility to model. In the Commercial market, utilization is trending upward in large group, ACOs are expanding, and the ACA individual market shrinkage of roughly 4 million lives is shifting the population into a small group (a segment many plans analytically underserve).
Layered on top of these segment pressures is a wave of new the Centers for Medicare and Medicaid Services (CMS) programs that are accelerating the VBC transition. TEAM and WISeR launched January 1, 2026. ACCESS was announced for July 2026. LEAD is proposed for 2027. The clear implication, as Dachary noted, “Payers are the solution company in this environment. As CMS fragments into more programs, more contract types, more payment models, the plans that win are the ones with the data infrastructure to manage complexity at speed.”
Five key findings from the 2025 MedInsight Payer Market Survey
The 2025 MedInsight payer market survey captured input from data and analytics practitioners at payer organizations spanning 50,000 to 2 million covered members. With 85% of respondents indicating that analytics is a primary part of their daily role, these aren’t casual observers; they’re the people closest to the data. That makes the effectiveness gap the survey uncovered all the more striking.
Finding #1: Margin pressure drives every decision
When asked what is driving their digital transformation investment, payers put improving operating margins at the top with 34% of respondents citing it as the primary driver, ahead of enhancing member experience (26%) and reducing administrative costs (21%). The takeaway: analytics investments that can’t tell a financial story are increasingly hard to justify.
Finding #2: Cost and utilization analytics is the #1 capability need
Respondents were clear about what they need most. The rankings for most critical future capabilities include:
- 72%: Cost and utilization analytics
- 59%: Quality and outcomes measurement
- 51%: Risk adjustment
- 49%: Value-based care analytics
The alignment between this priority ranking and MedInsight’s core portfolio is direct: Payer Platform for Total Cost of Care (TCOC) management, Payer Insights for quality and cost monitoring, the Risk Adjustment Portal for Risk adjustment factor (RAF) accuracy and RADV readiness, and VBC Contracts for Payer in active development.
Finding #3: Effectiveness lags far behind priority
Despite 72% of payers naming cost and utilization analytics as their top capability need, only 13% say they currently use analytics “very effectively” for TCOC management. Fewer than two in three report using analytics effectively at all.
“That gap between what payers know they need and what they can actually execute is the entire reason we built MedInsight.” — Marcos Dachary
The root causes identified in the survey are structural: lack of data integration (64%), limited analytic resources (44%), and data accuracy and quality issues (38%). These are not technology gaps that new tools alone can close. They require a platform built for integration, standardization, and workflow adoption at scale.
Finding #4: VBC success requires overcoming real barriers
As plans accelerate their move into value-based contracts, four barriers consistently emerge: data sharing challenges between payers and vendors, the need for ongoing analysis rather than point-in-time reporting, overly narrow population focus limiting TCOC management, and the risk of working with new VBC vendors who lack a proven track record. Christopher Kunkel, drawing on experience from both the vendor and health plan sides of the table, noted that Milliman’s combination of consulting expertise and MedInsight data and analytics positions them well as a trusted third party, supporting contract development, settlements, and ongoing analysis without requiring plans to expose sensitive data to vendors.
Finding #5: 2026 is the year of AI ROI, not only AI investment
AI demand is real: 26% of respondents named AI and advanced analytics as their top investment priority for the next 12–18 months. But the barrier to scaling is equally real: 58% cite legacy system integration as their #1 obstacle. The distinction the MedInsight team drew was deliberate and important. This is no longer the year to explore AI; it’s the year to prove ROI.
MedInsight’s perspective: its investment in Databricks five years ago put the platform ahead of today’s AI wave rather than racing to catch up. The Data Confidence Model (DCM.AI) was purpose-built to keep AI outputs grounded in trusted, governed data, helping close the governance maturity gap highlighted by the 49% of respondents who rate their capabilities as only intermediate.
From survey challenges to solutions: The enterprise success map
Lauren Piacentini connected the survey findings directly to MedInsight’s solutions, effectively moving from diagnosis to prescription.
The four challenge-to-solution pairings:
- Analytics effectiveness gap → Payer Platform: End-to-end TCOC management, actuarially standardized, starting from day one
- Data fragmentation → Employer Group Insights (EGI): Group-level benchmarking and clinical program ROI for employer account teams
- Speed to insight and quality measurement → Payer Insights: Executive-level contract monitoring without requiring analyst intervention
- Risk adjustment as a top priority → Risk Adjustment Platform: RAF accuracy, RADV readiness, and STARS cut-point modeling
Underpinning all four solutions is the Milliman Normative Advantage: 65 million commercial lives, 4.5 million Medicare Advantage lives refreshed quarterly, and 80 million managed Medicaid lives, all enriched with Milliman’s actuarial framework. Dachary highlighted, “When you benchmark in MedInsight, you’re not benchmarking against a proprietary dataset of unknown provenance. You’re benchmarking against the same foundation our actuaries use for bid work, IBNR, and rate filings.”
Key takeaways for payer organizations
The discussion closed with five action-oriented takeaways, each tied to a concrete MedInsight capability:
- Tell the financial story. Margin pressure is the #1 driver. Analytics partners that can’t speak actuarial are increasingly hard to justify.
- Solve the trend problem. 72% cite cost/utilization as critical, yet only 13% are effective. Milliman normative benchmarks close this gap with contextual, peer-benchmarked intelligence.
- Demand AI ROI now. 26% are investing in AI. DCM.AI and a Databricks-based infrastructure mean MedInsight is already delivering on data trustworthiness; not starting that work today.
- Prioritize a cloud-native foundation. 58% name legacy integration as their #1 AI barrier. A shared data layer on cloud removes that constraint without expanding the tool footprint.
- Reach information consumers. Analytics shouldn’t stop at the analyst’s laptop. The MedInsight App Library puts insight in front of every stakeholder, including CFOs, government program teams, VBC contracting leads, and employer account managers.
Learn more
Ready to close the analytics effectiveness gap at your organization?
- Book a call or demo to see how Milliman MedInsight maps to your specific challenges.
- Watch the full webinar recording and access survey findings.
