From the Philadelphia Inquirer:

Independence Blue Cross, the dominant health insurer for workers in the Philadelphia area, is establishing a nonprofit foundation designed to raise the insurer’s profile as a donor to health-related programs.

IBC will initially fund the foundation by bundling its current grant programs for poverty clinics and nursing-student scholarships, plus a new “innovation grants” program for medical-records systems and other cost-saving initiatives.

IBC chief executive Daniel Hilferty told me the Independence Blue Cross Foundation is IBC’s attempt to set up a miniature local version of the California-based Kaiser Family Foundation that he hopes will be a model for other Blue Cross insurers.

Read more on the formation of IBC’s non-profit foundation from the Philadelphia Inquirer. ]]> http://www.healthpointpa.com/archives/ibc-establishing-a-non-profit-foundation-to-aid-health-related-programs/feed/ 0 http://www.healthpointpa.com/archives/new-incentive-program-to-improve-care-and-reduce-costs/#utm_source=feed&utm_medium=feed&utm_campaign=feed http://www.healthpointpa.com/archives/new-incentive-program-to-improve-care-and-reduce-costs/#comments Wed, 08 Jun 2011 14:29:55 +0000 Intern http://www.healthpointpa.com/?p=10273 Bucks County Courier Times shares the story:

Local hospitals and doctors have a new reason to improve the quality of medical care while reducing its costs: a bigger pay day.

The Philadelphia region’s largest insurer, Independence Blue Cross, is replacing its pay-for-performance hospital contracts with an enhanced model that provides extra payments to hospitals and doctors for working together to improve patient care and reduce costs.

The new Integrated Provider Performance Incentive program replaces the insurer’s previous incentive program, which was geared solely toward improving medical care quality.

Participation in the new program is voluntary, but it provides a far greater potential financial incentive — as much as seven to eight figures a year. It also includes medical specialists who weren’t included in similar programs previously.

The Philadelphia health care market is notoriously expensive. Among the contributing factors that Independence Blue Cross has observed is that not much is being done to improve medical care coordination to reduce costs mostly associated with duplicate tests and paperwork.

Read more at, Bucks County Courier Times

Independence Blue Cross and the Jefferson Health System announced Tuesday that they have reached early agreement on a new contract that will run until May 2013 and is a model for other hospitals in the region.

It is the first to expand on the insurer’s previous pay-for-performance program to include physicians who work in the health system and to consider both the quality and cost of the care provided, said Douglas L. Chaet, senior vice president, Contracting and Provider Networks at IBC.

Read More

In a bid to boost beleaguered primary-care doctors and encourage more preventive care for the public, Independence Blue Cross announced a plan Thursday to pay physicians more if their patients’ health improves.

Independence, the region’s largest health insurer, will spend an extra $47 million a year to increase base pay and double incentive programs that already encourage primary-care doctors to deliver higher quality and less costly care.

Starting July 1, a doctor with 850 Keystone HMO patients could earn up to $150,000 more a year, said Steven Udvarhelyi, executive vice president of health services at Independence.

“We think this is a significant opportunity for primary care physicians who are doing a good job,” he said. “It is a great incentive for them to improve over time.”

Eric Grossman, a senior partner at the consulting firm Mercer, in Norwalk, Conn., said that while insurers have dabbled with so-called pay-for-performance models, Independence’s effort was a significant development.

The insurer “has definitely, by this announcement, inserted themselves into the early adopters of that movement,” Grossman said.

Find out more.

Carolyn Johnson’s monthly health-insurance premiums nearly doubled this month, from $313 to $600 – a tough jump for a laid-off legal assistant who lives with her retired father and gets by on unemployment benefits.

In this case, the staggering 92 percent rate increase was not imposed by an insurance company but by the state of Pennsylvania. Johnson’s coverage is equivalent to the adultBasic plan provided by the state’s Insurance Department, headed by a commissioner who has been active in pushing for sweeping changes to the nation’s health-care system.

“You are not going to find me defending this as a good choice,” said Insurance Commissioner Joel Ario, who sat next to President Obama at a recent White House conference on insurance.

“Among the horrible choices, this is the least obscene,” Ario said, blaming the increase on the rising costs of medical care.

Pennsylvania’s adultBasic is a state-run health-insurance program for the unemployed and financially distressed. That’s what makes this increase so onerous, said Jonathan Stein, a lawyer with Community Legal Services and a frequent critic of insurance companies.

“Essentially the state and [the nonprofit Independence Blue Cross] are acting like a for-profit insurance company, pricing people who are needy out of insurance,” he said.

In February 2007, Johnson, 53, lost her job as a legal assistant. She eventually went on the waiting list for Pennsylvania’s subsidized adultBasic plan.

The program, administered in this area by Independence Blue Cross, is partly funded by payments to the state from the four Blue Cross insurance companies that sell policies in Pennsylvania.

Independence Blue Cross paid $61 million last year, of which $36.6 million underwrites the adultBasic program, Independence Blue Cross spokeswoman Elizabeth Williams said.

Read more

The [suburban Philadelphia] region’s largest health insurer is replacing three individual Personal Choice plans that provide coverage regardless of pre-existing conditions.

More than 8,100 Bucks and Montgomery counties residents who have individual health plans are scrambling after they were notified last month that Independence Blue Cross is replacing their plans with new ones requiring far more cost sharing and benefit limits.

The Philadelphia region’s largest insurer is eliminating its longtime Personal Choice Standard, High and Prime options, which cover pre-existing medical conditions, saying the 20-year-old plans’ benefits structure is inappropriate in today’s market. The plans are available to self-employed individuals and their families.

“Medical technology has significantly advanced, demand for the latest technology and utilization of health care services has skyrocketed, and our population is aging, creating one of the most expensive health care markets,” company spokeswoman Ruth Stoolman said. “However, our product design for these plans hasn’t changed until now.”

Independence Blue Cross, which is a nonprofit, is the only health insurer in the Philadelphia region and one of the few in the United States to offer guaranteed issue individual plans that don’t require medical underwriting. Guaranteed issue plans also cover individuals other insurers reject as too medically risky.

Affected members have until Friday to pick a new plan or they’ll be automatically enrolled in the new high-deductible Personal Choice Value Health Savings Account plan, to prevent coverage lapses once the present plans are discontinued March 1. The changes don’t affect small- or large-group plan customers.

More money, less coverage

Newtown Township resident Gayle Share-Raab says she was shocked when she saw the difference in benefits between the new plans and the Personal Choice Standard Option she has now.

Her family’s annual out-of-network deductible will increase from $3,500 to $10,000 and the annual out-of-pocket maximum will increase $1,000 for in-network care, under the new Personal Choice Basic option, which is considered the closest comparable plan.

Doctor visit co-pays will at least double, from $15 to $30 for primary and preventive visits and $50 for specialists. An emergency room visit will jump from the $40 co-pay to 80 percent of the bill once the deductible is met. The ER bill also won’t be waived if the person is admitted, under the new plans.

Learn more.

More than 500 Independence Blue Cross employees have accepted early-retirement packages, as Philadelphia’s largest health insurer struggles to cut costs.

The buyout was offered to 840 employees. Most of the 530 who opted for it left last Friday. Employment at Blue Cross has declined more than 700 since the start of the year.

“Like any business in the current environment, we are taking prudent steps to manage costs and risks, including organizational streamlining,” the company said in a statement released yesterday.

“We are currently analyzing the impact of the results of the voluntary early-retirement program, and we have not made any further definitive plans regarding our future staffing needs.”

Communications to the employees said that, depending on response to the offer, “it’s possible that we may need to further reduce staffing or other expenses.”

Health insurers all over the country are shedding jobs, in tandem with major cuts by the nation’s employers. When companies lay off employees, they and their families lose their health insurance and the insurers lose business. Employment-based insurance remains the main way that people are covered.

Find out more at the Inquirer.

The editorial from the Times-Tribune calls for a statewide health care plan for public school teachers.  Write the editors:

“One of the smartest things that the state government could do for local taxpayers would be to mandate a statewide health care plan for public school teachers.

For years, lawmakers have been well aware of the financial benefits of such a plan. In 2004 the Legislative Budget and Finance Committee, which includes members of both houses, commissioned a study of the potential savings that would result from establishing a single health care plan to cover all state employees and public education employees. The study found that had such a plan been in effect for the 2002-2003 school year, taxpayers would have saved a whopping $585 million in health care costs.

A bill introduced recently in the state House would pick up where that study ended. It would create a Public School Employees’ Benefits Board to update that study, then design a statewide health benefits plan for school employees.

The need for such a plan existed before the current state budget problems. Taxpayers pay more than $1.5 billion every year for public school health care plans, about 16 percent of all school property taxes. Even if the savings projected in 2004 could be realized, the statewide plan could reduce those local costs by a third.

An added advantage of such an arrangement is that it would help to alleviate vast economic disparities among Pennsylvania’s 500 school districts, a longtime state goal.

State employees work in every corner of Pennsylvania and are covered by common health plans. Teachers themselves belong to a statewide common pension plan.”

Read the rest of the editorial here.

Meanwhile, the CEO of Independence Blue Cross, Joseph Frick, says that the federal healthcare reform should build on the existing healthcare system.  He writes:

“Polls show that 70 percent of Americans believe our health-care system needs an overhaul. Yet more than 80 percent of those who have coverage are satisfied with it and don’t want to give it up. So Americans want to reform what’s broken without breaking what’s working.

That’s why we support comprehensive health-care reform that provides affordable, high-quality coverage to everyone by building on the employer-based system that’s serving 170 million Americans. We agree with the key provisions of the reform package developing in Washington: ensuring everyone is covered, guaranteeing coverage for preexisting conditions, making coverage portable, simplifying the purchase of insurance, helping working families and small businesses afford insurance, and researching which treatments work to make care more consistent and effective.

Above all, we believe that reform must include a real effort to reduce the growth of health-care costs, ensuring that coverage is affordable and the system is sustainable. We believe health-insurance plans are showing how that can be done: by simplifying administration; redesigning payment to doctors and hospitals so that it rewards quality; expanding wellness, disease-management, and prevention efforts; and using more information technology to keep people healthy.

We also believe we ought to give these reforms a chance without the introduction of a new government-run plan. A government plan would dismantle employer-based health coverage, undermining the president’s pledge that people who like their health-care plans and doctors will be able to keep them. Some estimates suggest that more than 119 million people would move to a new government-run plan in its first year.”

Read the rest of his op-ed here.

And then, COMMENT, readers!  Who do you agree with?  Who do you disagree with?  Why?

Independence Blue Cross is seeking rate increases in the 20-to-50 percent range for 33,000 nongroup policyholders.

Although that’s less than 2 percent of the two million IBC policyholders in the Philadelphia region, they tend to be those who do not have coverage through their employers and would be more likely to go uninsured if they decide that they can’t afford health-insurance premiums.

…

[Elizabeth Williams, spokesperson for IBC] confirmed that IBC had filed for the increases without any public announcement or notice to the affected policyholders. It is the company’s practice, she said, to wait until the state Insurance Department takes action on the rate requests and then notify policyholders.

IBC asked for the increases to take effect July 1.

Melissa Fox, a spokeswoman for the state Insurance Department, said the public would have about 30 days to comment on the rate request. State officials would then review the filings and act on IBC’s requests.

…

The proposed rate increases would affect three different groups of IBC policyholders:

* Nongroup Personal Choice subscribers, a group of about 20,000 customers ranging from singles in their 20s to families with children. The lowest rate in this category, for a single person under 29 years old, with standard-option coverage, would climb from $162 a month to $207 a month. The highest rate, for a family with high-option coverage and adults over 60 years old, would climb from $2,567 a month to $3,214 a month.

* Nongroup Special Care Hospital coverage. Williams said the plan was developed for low-income households, now covering about 10,000 people. They’ll face a 27 percent increase in insurance costs.

* Nongroup Basic Blue Cross Hospital coverage. Williams said the boosts would affect about 2,800 people, mostly elderly, who would face increases ranging from 24 to 43 percent.

Read more at the Inquirer.

In response to cutbacks among companies that buy its services and growing demands for cost control, the region’s largest private health insurer has begun notifying employees that it is eliminating some jobs.

Beginning about two weeks ago, Independence Blue Cross told workers that 100 to 125 positions in two divisions will be dropped by June, said spokeswoman Liz Williams. Affected employees can apply for other open jobs, so it is unknown how many will be out of work.

She said 10 to 12 divisions were still studying how to improve “productivity and efficiency.” There is no deadline for making cuts.

Williams said some eliminated positions were at the “senior-most level,” though she declined to name them.

Independence Blue Cross has 8,880 employees and 3.4 million subscribers.

Williams said Blue Cross expected to lose subscribers as companies that purchase coverage for workers cut the size of their staffs. “We’re beginning to see a little bit of that and there’s more coming,” she said without divulging specific numbers.

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