Emblem Health, Northwell to Announce Risk-Based Contract

The Well wellness site

March 25, 2016

EmblemHealth will announce Friday a new contract with Northwell Health, which moves the state’s largest private health provider further down the path of risk-based contracts, the type so favored by state policymakers and beloved by insurance executives.
The specifics of the contract are closely guarded but what is known is that this will be a two-year contract covering roughly 170,000 Emblem members. Of those, about 12,000 enrolled in Medicare, Medicaid and commercial insurance will be part of a risk-based arrangement.
In the first year, any savings off the predetermined benchmark cost will be shared between Northwell and Emblem. But in the second year, Northwell, formerly known as North Shore-LIJ, has agreed to assume a level of risk.
That means if the care is more expensive than the benchmark cost, Northwell eats the cost, up to a certain amount at which point the costs are again split.
If, however, Northwell can deliver the care for less than the benchmark, the health system keeps the savings — again, up to a certain amount.
Emblem has agreed to protect Northwell from certain anomalous events, such as car accidents that unexpectedly and significantly increase the cost of care.
The 12,000 members were chosen based on their primary care physician.
Jason Helgerson, the state’s Medicaid director, is pushing these types of contracts in the Medicaid program believing they are the most efficient ways to control health care costs. The state’s “roadmap” calls these types of contracts a “fundamental step” in the effort to have at least 80 percent of Medicaid providers engaged in some type of value-based arrangement by the end of the decade.
Public health officials believe pushing change in Medicaid will force the commercial market to follow.
Karen Ignagni, who took over Emblem in September, has been blunt in her assessment of the insurance marketplace. The way forward, she says, is to have providers and payers share in risk because the fee-for-service model was increasing costs to consumers at a level that had become untenable.
“By moving away from arrangements that pay clinicians on a fee-for-service basis, we have empowered our provider partners to be more accountable for improving quality and lowering costs,” she recently wrote. “Analyzing claims and pharmacy data — along with putting relevant, timely, data-driven information in the hands of our clinical partners — is contributing to better care coordination and health outcomes.”

Crain’s Health Pulse
March 25, 2016
Northwell-Emblem Pact

Under a new contract, EmblemHealth is shifting toward value-based payments more of its care that is provided to Northwell Health members. The agreement covers 170,000 members in New York City and on Long Island. It will start with shared savings, providing bonuses to the health system when costs are lower than expected. There are also bundled payments for knee and hip replacements, and coronary artery bypass graft surgery. The contract was signed earlier this month and is retroactive to Jan. 1. The two sides had already begun sharing data and working with doctors to advise patients on when to use urgent-care centers or the emergency room for treatment. Those settings can be costlier for insurers than primary care. In Manhattan and on Staten Island, where the partnership started on those initiatives, emergency-room admissions fell 10%, according to Emblem. It plans to expand those efforts in Queens and on Long Island. The deal continues Emblem's push into value-based payments, which Chief Executive Karen Ignagni has said will fuel the insurer's financial turnaround. Emblem also struck an accountable care agreement with the Chinese American IPA earlier this month, covering 33,000 lives. Emblem plans to move more of its providers to shared-risk arrangements, in which providers are penalized when costs exceed expectations. Emblem and Northwell are discussing plans to create certain products that would incentivize visits to Northwell or Emblem's partner AdvantageCare Physicians. In the case of its recent deal covering municipal workers in New York City, Emblem rewarded visits to ACP doctors with lower co-pays.

Healthcare Business Daily News
March 25, 2016
EmblemHealth, Northwell Sign New Leadership Agreement to Drive Value-Based Care

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