Reprinted from NJ.com
Rose Duger/For The Jersey Journal
A new insurance plan has entered the Hudson County health care marketplace aiming to capitalize on efficiencies and emphasize preventive care to curb rising medical costs.
CarePoint Health Plans is a Medicare Advantage plan offered through Hudson Holdco Inc., the for-profit system that owns Christ Hospital in Jersey City, Bayonne Medical Center and Hoboken University Medical Center.
Launched late last year, it enrolls several hundred subscribers, according to the CEOs of the three hospitals who say the new insurance offering is a response to the inability of fee-for-service plans to stem rising health costs.
“If you take a look at health care in general, the current model of fee-for-service is not tenable,” said Mark Spektor, the president and chief executive officer of Bayonne Medical Center who is also a medical doctor. “The real way to think about health care in the future is that it will be vertically integrated. It will all be rolled into an efficient delivery system.”
To achieve that, CarePoint enrolls all three Hudson Holdco hospitals, as well as satellite testing and care facilities, nursing homes and 90 percent of the health system’s physicians. The CEOs note that the other 10 percent of physicians serve non-Medicare patients such as children and pregnant women.
One of only two insurance plans in the state in which a health care provider also serves as an insurer, CarePoint Health Plans promotes preventive care by assigning a case manager and a nurse practitioner to each enrolled patient to monitor care and ensure they participate in preventive services. The plan compensates physicians based on performance, which includes emphasizing preventive care.
The PPO — Preferred Provider Organization — allows patients to pay a higher fee to choose out-of-network providers.
An integrated medical records system provides instant access to each patient’s information including medications, allergies, imaging studies, test results and other procedures to all providers within the plan via smart phones or computers.
“This is 180 degrees different than current insurance models,” Peter A. Kelly, president and chief executive officer of Christ Hospital, said. “Right now, insurers provide incentives to intervene late. We provide incentives to intervene at the earliest onset of a condition, which is economically more feasible. It’s a very patient-centered approach that emphasizes high quality care at a lower cost.”
While this insurance model is relatively new in New Jersey, it has proven to be successful in other parts of the country, Paul A. Walker, president and chief executive officer of Hoboken University Medical Center, said.
“There are multiple models around the country that have succeeded with this three-legged stool, in which there are hospitals that provide physicians and insurance,” he said, noting that a key goal is to keep patients out of the hospital whenever possible. “As things start to shift or align, hospitals are able to keep more patients out of hospital beds and still maintain their financial revenue to balance the whole portfolio. Then we can do the right things in terms of patient care.”
Approved in 2012
The state Department of Banking and Insurance approved CarePoint back in February 2012, according to Ed Rogan, the department’s spokesman. The federal government is also required to give its OK, Rogan said.
Insurance programs sponsored by hospitals are “relatively new, but it’s not the first one that we saw,” he said.
The three Hudson Holdco executives pointed out that for-profit hospital systems are well-positioned to pioneer this relatively new model of health insurance because of the emphasis on efficiency and self reliance.
“If you take a look at cost, the infrastructure in not-for-profits is enormous. They have to rely on the state and federal governments to bail them out,” said Kelly, who spent the majority of his career in the not-for-profit sector. “The big difference here in Hudson County is that we’ve taken a huge burden off the state. All three of our hospitals no longer rely on state stabilization dollars. And we pay millions to the municipalities in taxes.”
Kelly added that Christ Hospital, which was purchased by Hudson Holdco last July, provides more charity care than a year ago; in January those patients will have insurance under the federal Affordable Care Act.
While Hurricane Sandy affected the plan’s first cycle of open enrollment last fall, the CEOs expect a brisker response this year as word gets out about the plan and more patients are eligible to apply under Medicaid.
“We’re confident that this is going to be a good year,” Spektor said.
Journal staff writer Terrence T. McDonald contributed to this report.