Banner Health and Aetna are taking their relationship to a new level in the form of a joint venture health plan.
For the past five years, Phoenix-based Banner and Hartford, Connecticut-based Aetna operated an accountable care organization, showing significant clinical improvements, including an 11.5 percent reduction in medical costs and a 24 percent decrease in avoidable surgery admissions.
Since the its inception in 2011, the Aetna-Banner ACO has achieved a shared savings of more than $9.9 million for members and customers in Arizona, said Tom Grote, president of Aetna’s Arizona market.
Now, Banner and Aetna are creating a new health insurance plan where they both own the company and share equally in the profits and losses. Today, they will be talking to the Arizona Department of Insurance to begin the application process to file for new insurance license.
While waiting for DOI approvals for the new health plan, which is expected somewhere around mid-2017, new commercial products will be ready as early as Jan. 1. Employer contracts can be converted upon their next renewal after the company is approved, Grote said.
The new health plan will integrate Aetna’s consumer engagement tools with Banner’s expertise in care management, engaging its providers in looking for new ways to improve care for members, said Chuck Lehn, vice president of strategic growth for Banner Health.
“The one area we haven’t fully solved yet is really improving the member experience,” Lehn said. “By going into the joint venture, we’re going to be seeking opportunities to have our systems talk to each other in more real time, so we can improve that member experience from the on-boarding process to streamlining claims in the administration process.”
The new health plan will start in Maricopa and Pinal counties, and grow statewide over time, Grote said, focusing on all sizes of employers, going down as small as two employees for small businesses.
“We’re going to have a full array of products in the market on both a fully insured and a self-funded basis,” he said. “We’re going to be introducing a new private exchange platform that will make it easier for employers to sign up for plans and members to enroll in products.”
While Banner has a handful of ACO relationships with other insurance carriers, this is the first time the nonprofit health system is teaming up with a carrier to form a new health plan.
This will be Aetna’s third such joint venture, Grote said, with similar arrangements formed with Inova Health System in Virginia and and another with Texas Health Resources in Texas.
In the metro Phoenix area, Aetna has about 380,000 commercial members, while Banner Health Network includes more than 900 primary care physicians and more than 5,800 specialists, with access to more than 125 urgent care centers as well as 14 hospitals, nine health centers and 11 emergency centers.
“Banner’s track record on population health initiatives — not only our ACO but their Medicare Pioneer ACO— really set them apart from the other providers in the marketplace,” Grote said. “That’s definitely a key factor in us aligning with Banner. We’ve had shared visions about what we need to do to improve the way health care is being delivered.”
In addition to Banner’s commitment to population health, it is in the process of acquiring 32 urgent care centers in Arizona, giving Aetna members easy access to care in their communities, Grote said.
Date:October 31, 2016