How community health plans drive down costs, improve care

Paper examines methods of community health plans that have found success

So far, the Affordable Care Act is doing what it was intended to do: Provide healthcare access to millions of previously uninsured Americans.

In an ever-evolving industry, though, there always is room for innovation. Community health plans have recognized this and look for ways to drive down healthcare costs while also increasing value. A new paper from the Alliance of Community Health Plans examines three health plans that are reshaping how healthcare is delivered at a lower cost. Listed below is how two of those three health plans did just that.

Group Health Cooperative, Washington

In 2012, after analyzing data from other health plans, Group Health set a goal of reducing expenses by $250 million over 18 months. The plan did this by focusing on improving quality and reducing operating costs, while also eliminating combined leadership positions. Group Health's board--one of the few healthcare organizations in the country governed by its members--continues to emphasize "effective collaboration and accountability for shared goals," CEO Scott Armstrong said in the paper.

So far, Group Health has reduced operating costs by nearly $100 million, received a 5-star rating from the Centers for Medicare & Medicaid Services and produced better quality performance results than all other providers in the Washington Health Alliance.

HealthPartners, Minnesota

In 2008 and 2009, HealthPartners saw medical costs rise 7.1 percent and 7.4 percent, respectively. That was lower than the national benchmark during that time, 8 percent, but it was still too high. With the intention of driving down costs, the health plan decided to tightly integrate its structure.

In 2009, HealthPartners and Allina Health, a nonprofit network of hospitals, teamed up to create a system focused on achieving the triple aim. By bringing together two competing delivery systems, the alliance experienced a decrease of $3.4 million on drug spending in 2012 and reduced the increase in medical costs to just 2.7 percent by 2013.  "We are an integrated finance and delivery system. We don't have separate goals, we all work toward the same goal," said CEO Mary Brainerd.   

For more:
- here's the paper (.pdf)

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