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NY Hospital Joins Payer Fray

Rene Letourneau, for HealthLeaders Media, August 5, 2013

Reduced care costs and higher patient volume are only two of the reasons North Shore LIJ Health System is launching its own commercial health plan. Other benefits: It will make "getting paid and paying our docs…much, much, much simpler," says one executive.

Last week, North Shore LIJ Health System—a 15-hospital integrated delivery network serving Long Island, Queens, Staten Island, and Manhattan—received approval from New York to launch the first provider-owned commercial health plan in the state.

CareConnect, the system's plan, will be sold through the state's health insurance exchange. Enrollment begins Oct. 1, and the plan goes into effect on Jan. 1, 2014.

Although the timing of the insurance license is perfect for selling the product through the exchange, the plan was not originally designed to coincide with the new online marketplace, says Howard Gold, North Shore LIJ's executive vice president of managed care and business development. Instead, the health plan was initially created to cover the system's own employees and their families.

"We've tried this with our employees, having a limited network, using our 15 hospitals and 5,000 doctors and our continuum of care," Gold says. "We have about 41,000 employees and family members. We have offered it to our employees for the last few years at a much cheaper basis."

The health plan reduced premium rates and overall care costs and drove patient volume to the health system, Gold says, adding, "Most people stayed in network … we have nearly 90% in-system utilization."

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