Earlier this month, representatives from Capital District Physicians’ Health Plan (CDPHP) traveled from their headquarters in Albany, to make a presentation to the SustiNet Health Care Cabinet. The cabinet, chaired by Lt. Governor Nancy Wyman, is charged with advising Gov. Dannel Malloy and the Office of Health Reform and Innovation on issues related to federal and state health care reform implementation. Dr. John Bennett, president and CEO of CDPHP, and Bob Little, vice president for underwriting, were invited by the Business Plan Development Work Group of the Cabinet. The workgroup is identifying gaps in the current system of health coverage in Connecticut and proposing alternatives for the offering of quality, affordable health benefits to small businesses and individuals.
CDPHP is a local, provider-directed, non-profit health plan that serves almost 400,000 members in the greater Albany area. They have put the triple aim, developed by the Institute of Health Improvement, under the leadership of Dr. Donald Berwick, at the center of their mission:
- better care for individuals (safe, effective, patient-centered, timely, efficient, equitable)
- lower costs, and
- improving the overall health of the population.
As a locally-based health plan they are dedicated to improving the health of the community through transforming care for their members. In their presentation, they showed cabinet members a model of what a health plan can be; one that actively partners with providers, employers and patients to improve care, lower costs and promote health.
The CDPHP model of business differs greatly from the commercial insurance model, the only type of health insurance available in the Connecticut market today. Aside from the obvious difference, that a publicly traded for-profit company must maximize shareholder value, commercial insurers also differ because they follow a business model that requires them to avoid risk. As Diane Archer and Theodore Marmor wrote recently in a Health Affairs blog:
“Insurance corporations receive premiums that must fund the costs of their enrollees’ health care and administrative costs, as well as profit margins sufficient to allow borrowing in the capital markets. To make that work, insurance firms avoid risk. They are rewarded for avoiding, within the rules of the day, those who are already sick, those likely to become sick, and those whose incomes are relatively low.”
CDPHP’s presentation also emphasized the importance of partnering with health care providers. They have invested health plan dollars to place care managers inside primary care practices to coordinate care and have also funded physician offices’ adoption of electronic medical records. They see these investments as ultimately helping the health plan to make sure their members get the care they need and keep health care costs and premiums lower. They made this investment to benefit their members, but clearly the members of other competitors benefited from it, too.
One of the best hopes for Connecticut to have a non-profit health plan working in partnership with providers to improve our health care system would be if the federal government would approve an application to provide start-up loans to establish a Consumer Operated and Oriented Plan (CO-OP) in Connecticut. Last October, the CSMS IPA and the Connecticut State Medical Society jointly applied to establish such a CO-OP. Unfortunately, to-date, their application has not been approved. (Disclosure: The Universal Health Care Foundation of Connecticut gave the CSMS a grant to help in writing the application).
With the exception of Community Health Network, the non-profit insurer created by the community health centers to offer Medicaid coverage, there are no non-profit insurers left in Connecticut. Through a series of mergers and conversions from non-profit to for-profit status, non-profit coverage is no longer an option in Connecticut’s small group or non-group insurance market. Furthermore, there have been no new entrants into Connecticut’s health insurance market since the mid-80s.
In a recent blog post, Wendell Potter called CO-OPs the “sleeper” in the health reform law that could, “transform the U.S. health care system.” CDPHP provides an example of how a locally based non-profit plan can push the transformation of care forward for members and non-members alike. Approval of CO-OP option in Connecticut should be a high priority for the state.