Updated Horizon announces ‘innovative’ partnership with major health care players

Listen to this article

Rewarding doctors for sending patients home faster and healthier is not a part of the traditional health care system, but a new alliance in the state — featuring many of the biggest names in the industry — hopes to change that.(Editor’s note: This report was updated Friday with substantial changes from the earlier version, including additional information and comments.)

Rewarding doctors for sending patients home faster and healthier is not a part of the traditional health care system, but a new alliance in the state — featuring many of the biggest names in the industry — hopes to change that.

Horizon Blue Cross Blue Shield of New Jersey announced Thursday a new program geared toward decreasing out-of-pocket costs for its members, and holding health care providers accountable for quality care.

The state’s largest insurance provider says it is partnering with six of the biggest New Jersey health care systems and the largest medical group to create the OMNIA Health Alliance, which will promote value-based service, an increasingly popular trend nationwide.

The company is calling the program a first-of-its-kind, “extremely innovative collaboration,” one that will financially benefit both policyholders and employers.

Horizon officials said it is too early put a dollar figure on any potential savings on premiums, but said they will be “substantial” when the plan rolls out in October.

However, someone familiar with the details of the plan, who was not authorized to speak on the potential savings, said the partners had access to the following data from 2014.

In that year, the person said, Horizon BCBSNJ members treated at a patient-centered practice, as compared with traditional practices, experienced better quality care measures, including a:

• 6 percent higher rate in improved diabetes control;
• 7 percent higher rate in cholesterol management for diabetic patients;
• 8 percent higher rate in colorectal cancer screenings; and a
• 3 percent higher rate in breast cancer screenings.

Additionally, the person said, Horizon BCBSNJ members treated at a patient-centered practice, as compared with traditional practices, experienced lower costs, including an:

• 8 percent lower rate in hospital admissions;
• 5 percent lower rate in emergency room visits; and a
• 9 percent lower total cost of care.

This plan, Horizon officials said, includes national, mid-level, labor, small and individual markets, as well as being on the national health care exchange, but does not include Medicare or Medicaid.

Horizon CEO Robert Marino added that the overall effect of this new plan would be “lower premiums, lower cost sharing and value created through wellness and better population management.”

Here’s how it will work:

Expanding on Horizon’s patient-centered medical home program, this partnership incentivizes health providers to send patients home, rather than adding services piecemeal during a visit. The idea is not new, as a national trend of transparency in health care has been developing similar solutions in the past few years, but it is the biggest push ever seen in New Jersey.

Joel Cantor, director of the Center for State Health Policy, said the program could be a game-changer.

“This is a very bold shift for them and is something that could be influential in shaping the New Jersey health care delivery system,” he said.

The new OMNIA Health Alliance includes Atlantic Health System, Barnabas Health, Hackensack University Health Network, Hunterdon Healthcare, Inspira Health Network, Robert Wood Johnson Health System and Summit Medical Group.

The size of these groups assure the program will have impact.

Last year, these organizations combined to serve a total of 4.8 million patients.

In addition to the OMNIA partners, eight hospital systems, or a total of 12 hospitals, will be a part of Horizon’s Tier 1 plan: Cape Regional Medical Center, Cooper University Health System, Englewood Hospital, Meridian Health, Shore Medical Canter, St. Joseph’s and Princeton HealthCare System.

Horizon, meanwhile, has 3.8 million covered lives, by far the largest number in the state.

Because of this, partnering made sense, Hackensack University Medical Center Chief Financial Officer Robert Glenning said.

Rather than waiting for legislative action, Glenning said, “We saw this as a concrete action we could take with a large health plan in-state to really look to move to better patient experience, reducing per capita cost of health care.”

A joint governing body will be created with senior-level members of each partner, as well as Horizon, in order to ensure accountability, as well as allow refinement as needed. In addition, a third-party system will be used to collect patient responses, which will help in determining the success and quality of care.

But with the shift comes a large risk for both Horizon and the health care systems, Cantor said. It could be a major success or fail miserably.

“In the longer run, Horizon is making a bet that health systems will learn how to do this well, but not well enough to not need Horizon anymore,” Cantor said.

Many industry leaders feel some dramatic change needs to take place.

The current system of health care, they say, rewards providers financially for added fees, and there is no benefit to ensuring a patient gets well quickly.

Because of that, they say the current system of piecemeal fees is not sustainable, and changes have to be made to a value-based system in order to curb rising health care costs for all involved parties.

This partnership, however, only benefits Horizon members, leaving other insurance networks out of the loop.

David Knowlton, president of the NJ Health Care Quality Institute, said that could be an issue.

“The other shoe is yet to drop,” he said. “This is going to be fascinating to watch because of the implications.

“They are so big that they can drive people in given markets out of business.”