Health care:
Williamson County’s partners benefit when workers not in hospital.
Seton Health Alliance and Aetna have created the Austin area’s first major accountable care organization.
GEORGETOWN— A health insurance option some call a game changer in Central Texas will soon be available to nearly 4,000 Williamson County employees and their families.
Seton Health Alliance and Aetna have poured millions of dollars into creating the Austin area’s first major commercial accountable care organization, which would offer financial incentives to doctors who keep their patients healthy and out of the hospital.
If all goes well, Williamson County could get a 17 percent discount on the costs of paying for care, county benefits administrator Shelley Loughrey said.
The county’s contributions toward its self-funded plan increased by about 64 percent between the 2008 and 2013 fiscal years to $14.7 million. In that time, Williamson County’s budget grew by around 20 percent.
Those mounting costs were one reason the county sought a new administrator and network provider, Loughrey said, in addition to shoddy customer service and technology that was behind the times. The Williamson County commissioners court voted unanimously for Aetna to take that role Monday afternoon.
Because Aetna is a giant in the insurance industry — and is able to negotiate cheaper prices for care and better handle expensive claims — the county’s health plan payments should now plateau rather than tick up every year, Loughrey said.
Aetna will offer two different types of plans: a traditional PPO with a wide network of health providers, and the accountable care organization with a narrow one.
Primary-care physicians must refer patients in the accountable care organization to Seton facilities. Patients could still seek care from other providers outside the network, but the cost wouldn’t be as deeply discounted.
Primary-care physicians would coordinate a patient’s care and communicate with specialists, nurses and other providers, said Greg Hartman, Seton Healthcare Family president of external affairs.
Accountable care organizations also move away from a typical payment model in which health providers receive a fee for each service they provide.
Under that model, health providers make more money if a patient stays longer in
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the hospital or if multiple tests are done, for instance.
Seton Health Alliance and Aetna will instead receive a monthly payment from Williamson County for every employee enrolled in the accountable care organization, Hartman said.
As a result, Seton Health Alliance and Aetna would save money by keeping patients out of the hospital.
“If we don’t keep peo- ple well, we pay for their hospital stay,” Hartman said. “If we do, we’re able to keep that member-permonth payment that we receive.”
Hospitals and physicians would also receive financial rewards for providing care at a certain quality level — and pay a penalty if they don’t.
Requiring referrals to Seton facilities will help keep the system solvent, said Jeff Cook, chief executive officer of the Seton Health Alliance.
Williamson County Judge Dan Gattis pointed out that county employees might be hesitant to join the accountable care organization if they have to switch doctors.
“My doctor right now is a St. David’s physician,” Gattis said. “If I choose the Seton Health Alliance, I’m going to have to change my primary-care physician.”
Nick Long, a benefits broker hired by the county, said he was confident that a significant number of employees would choose the accountable care organization, since a majority are currently in the low-cost plan option offered.
Families could save more than $5,500 a year if they participate in the accountable care organization, Long said.
The accountable care organization will temporarily include physicians who are part of Aetna’s network in the first year, while Seton Health Alliance recruits physicians to participate, Cook said.
Some health systems have functioned similar to an accountable care organization for decades, said Robert Berenson, a senior fellow at the Ur- ban Institute specializing in health care policy.
The Affordable Care Act, which provides for federal incentives for Medicare accountable care organizations, helped spawn more such systems, Berenson said.
It’s unclear whether commercial accountable care organizations actually achieve their aims of providing better care and reducing costs, Berenson said.
Private insurers aren’t required to release data because it’s considered proprietary information, Berenson said.
In 2011, Seton Health Alliance and Austin Regional Clinic were approved by the federal government to start a Medicare accountable care organization, which currently has 15,000 patients, Hartman said.
Aetna has accountable care organizations with health providers in the Dallas, San Antonio and Houston areas, said Louie Heerwagen, a sales vice president for the company.