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Analysis

Six New Jersey Health Systems Borrow a Page From Amazon

By Philip Betbeze  
   April 12, 2018

Value-based strategies

It's ironic that health systems that are in part responsible for high healthcare costs are themselves victims, but that truth represents the pernicious and complex reasons healthcare costs so much.

Atlantic Health System, for one, has already implemented several value-based strategies on the healthcare delivery side and has made great strides in value through its ACO, which has more than 390,000 attributed lives.

While the ACO is one way to help reduce costs and improve efficiency, Joyce says this effort is another bold attempt by the health system to leverage its heft as an employer along with other large employers in the state to improve value.

"We're really looking at it from an employer's perspective," says Joyce. "We're self-insured, so we spend a lot of money there, and we're looking to reduce those costs and hit the triple aim for our employees and families."

Combined, the six health systems spend more than $250 million a year for health benefits.

Even though many of them have had limited success in improving value through benefit redesign and better use of analytics to determine appropriateness of certain care protocols, the ability to bring together a quarter billion dollars in annual spending should bring benefits right away, says Kevin Slavin, president and CEO of St. Joseph's Health, a three-hospital health system based in Paterson, New Jersey.

"Each of us have had our different strategies to reduce costs and improve care for our beneficiaries, but now we have six systems that can share those ideas and harness power together," he says. "We believe we'll see immediate in savings cost per enrollee."

The consortium will be expected to further develop ideas for improving utilization and implementing population health strategy. Committees with representatives from all six health systems have been set up and are meeting, Joyce says.

"We're a small state, yet there are variances," he says. "We'll be developing best practices around some of those variances that will help drive the value proposition for us but also for other payers who use us as providers."

Philip Betbeze is the senior leadership editor at HealthLeaders.


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