Crain’s Health Pulse
August 11, 2014
North Shore-LIJ's Insurance Company Expands
CareConnect was licensed a year ago as an insurer and began marketing a range of plans on Oct. 1, driven by the vision that an integrated health care system could deliver quality care at a lower cost. Treatment decisions are peer-reviewed with few denials, given doctors are running the show.
"The vision is working. We treat people differently," said Alan Murray, president and chief executive of North Shore-LIJ CareConnect, owned by the North Shore LIJ Health System.
The insurer's current network consists of the providers and facilities within the vast system, but that is about to change. In recent months, CareConnect has reached out to hospitals it considers like-minded, which will duplicate the clinical integration model. The hospitals are either affiliates of North Shore-LIJ, in acquisition talks with it, or willing to take a chance on CareConnect's philosophy. The hospitals that will be added to the network on Jan. 1 are Montefiore, Phelps Memorial, Northern Westchester, Maimonides and Wyckoff Heights.
"We're partnering with only a few," said Mr. Murray. "To execute the vision, you have to be small."
To attract more New York employers that have workers in New Jersey and Connecticut, the insurer is adding the Barnabas Health system and Yale-New Haven Hospital. For enrollees who travel out of the area, CareConnect signed a deal with Minute Clinics, and is working on a deal for urgent care. CareConnect offers no out-of-network coverage.
The rate-setting process is never easy, and is harrowing for a new insurer. CareConnect filed small group rates that overall are 14.5% lower than this year's rates. Individual rates also will fall.
"Pricing was higher than the market," said Mr. Murray, resulting in small group enrollment that was slightly less than projections, but large group and individual enrollment that beat estimates.
At about 10,000 members, CareConnect has had enrollment in its first year at a number "that pressure-tested the model to see if it was workable. And it was," he added. "Now we have a platform to scale and continue to be successful."
The company's 2015 filed small group rates for gold plans, with a comparison to its competition, are online here. A similar chart with filed individual rates is online here.