The health insurance business has never been easy. The human body is a complex machine with lots of ways for gears to grind. Multiply that by millions of bodies, the need for quantification across various dimensions (diagnostic, treatment, financial), and the need for interactions with patients and providers, and you have a mountain of convolution. But at least the regulatory landscape was predictable.
No longer. Several years ago we saw the unwinding of the Medicaid continuous-enrollment provision. In July 2025, there were the changes proposed by the One Big Beautiful Bill Act (OBBBA). A notable recent example has been the seesawing fate of the Affordable Care Act’s enhanced premium tax credit. With several of the new provisions stayed by the U.S. District Court for the District of Maryland, CMS proposed on Feb. 9 sweeping changes to plan designs, eligibility and income verification, and more for the 2027 plan year. Because some of the provisions contradict the language of the Affordable Care Act, we anticipate legal pushback once more – leading to further regulatory uncertainty.
In short, while the details may change, a new reality has taken shape: Health insurers can no longer rely on stable, predictable regulatory foundations. Combined with economic instability and falling health-exchange enrollment, this new normal necessitates agility and dynamism across several business fronts. Health insurers must shift from a policy compliance-focused operating model to one emphasizing product innovation and operational flexibility. This represents not just a transition, but a reinvention. Here are three potential ways to approach this transformation.
Get leadership on board first
Health insurance leaders must first accept that the old way of doing business – characterized by siloed organizational functions – won’t cut it anymore. This demands a mindset change among leadership at all levels. The shift toward organization-wide agility is an opportunity to roll up sleeves and partner with colleagues in other functions to enable more dynamism and flexibility.
One way to foster such a mindset change is to formalize a leadership rapid-response team. This cross-functional tiger team of leaders meets regularly, developing a rapport and a shared sense of mission while communicating across silos with the ultimate goal of breaking them down. Insurers will continue to have diverse expertise, but they can’t continue to have that expertise in largely disconnected functions.
What might a tiger team grapple with? A production-focused operating model with new definitions of success will need new KPIs. Here are some new KPI examples. 1) If responding quickly to regulatory change is now a priority, you track the time from the new rule taking effect to a new, related capability hitting production. 2) You establish a KPI based on the time required to produce an audit response, thereby giving impetus for more flexibility in compliance systems and processes. 3) On the product-design front, you set up a decision turnaround-time KPI to track the number of business days from product-concept approval to final pricing submission for regulatory review.
Transform governance for the new normal
New production-based operating models demand new governance models. In our new normal of volatility, health insurers must foster quick decision-making capabilities vertically and horizontally across the org chart, and with a clear understanding of responsibility and ownership for decisions. Governance structures need to be transparent to several levels of leaders in order to facilitate faster decision making. Decision rights and escalation paths need to be simplified where possible and clarified for all key functions. Workflows for compliance and risk need to be integrated to accelerate execution and avoid bottlenecks. And leaders need to facilitate teams working together in ways that balance flexibility with financial discipline. Effective governance ensures that you not only stay compliant with regulatory requirements, but also align execution with strategic goals such as pricing, product launches, actuarial rigor, and financial stability.
Reposition IT as value center rather than a cost center
AI will play a growing role in health insurer IT systems. At the highest level, it’s important to find AI opportunities where clinical and operational outcomes demonstrate value. For example, AI can materially reduce administrative friction in prior authorization and denials workflows when applied to document intake, clinical summarization, intelligent triage, and appeal prediction. These uses accelerate cycle times and reduce manual handling without replacing regulated medical-necessity decisions that require clinical oversight and auditability. To remain adaptable under policy volatility, these capabilities should be built as modular decision services, separating workflow, rules, and model logic so criteria can be reconfigured without rewriting core systems.
Agility, however, depends less on AI than on architecture. Many payers have implemented FHIR APIs for compliance. Used strategically, FHIR can serve as a standardized exchange layer at system boundaries. Combined with API management, event-driven integration, and externalized rules engines, this reduces tight couplings across claims, eligibility, and utilization management platforms. Doing so lets you shift attention to platform strategy and application rationalization, addressing redundancy and accumulated legacy technical debt.
Core systems remain systems of record, but policy logic and orchestration can be abstracted outward. That separation enables faster regulatory response through configuration rather than disruptive system change, positioning IT as an engine of enterprise adaptability rather than overhead.
More complexity is the new normal
Perhaps the current regulatory upheaval will turn out to be a short transition period into a new steady state – one that, with a few superficial adjustments, lets health insurers settle into another comfortable long-term pattern. I wouldn’t hold onto that belief too tightly, and it’s safe to say that few health insurance leaders will, either.
Those with foresight will recognize the need to boost their organization’s ability to manage complexity and surprises as a more integrated whole. That takes changes in leadership mindset, governance, and IT capabilities. Done right, insurers will respond to the burdens of regulatory change by instituting deep-rooted organizational and operational changes that make life better for patients, providers, and themselves.
Rebecca Whitehead
Rebecca Whitehead is the Nashville Market Leader at The Gunter Group, where she brings over 20 years of experience as a strategic healthcare operator, consulting executive, P&L leader, and board director. Known for delivering purpose-driven results, she specializes in scaling operations, transforming business models, and accelerating innovation across the healthcare landscape. Her career spans a range of sectors — from national payers like UnitedHealthcare to growth-stage organizations like Newport Healthcare — where she has consistently led high-impact initiatives at the intersection of strategy, operations, and transformation. Rebecca thrives when collaborating to solve complex problems, and is most energized when channeling her creativity into building new strategies that improve care, outcomes, and business performance.
