Boeing and ACOs Dump Insurance Middle Man

Boeing and healthcare providers in the Seattle area have dumped the insurance middle man.

On June 13, 2014, the giant aerospace company and two accountable care organizations (ACOs) formed by UW Medicine and Providence Health & Services and Swedish Health Services, formed a partnership to provide care for the employer. No insurance company is involved. Boeing has separate contracts with each provider.

“The advantage for Boeing will be that they can take the middle man out of the equation between the patients and the health system. It may be able to reduce cost, in part because of the simplification of not having the insurance mechanism in the middle, ” said Dr. Elliott Fisher, director of the Dartmouth Institute for Health Policy and Clinical Practice in New Hampshire.

“It’s a very interesting model and worth pursuing, ” Fisher said in an article published in the Seattle Times on June 17, 2013.

30, 000 Patients

Boeing has “created a flight plan for a new era of health care, ” said Paul Ramsey, M.D., chief executive officer of UW Medicine. Starting in January, 2015, 27, 000 Boeing employees and some 3, 000 retirees will begin the program. Eligible participants—who include nonunion workers and certain union-bargaining units—will also have the option of keeping their current plans or choosing another non-ACO plan. Those signing up for Preferred Partnership will select between Providence-Swedish or UW Medicine.

In the deals, the contracts set goals for the employees’ medical costs. If the costs are higher or lower, the provider either foots the bill or reaps the savings.

The contracts allow patients the ability to schedule appointments in a timely manner and require the providers to maintain patient safety and satisfaction information. There are additional benchmarks tied to costs, including reducing readmissions to hospitals after treatments and effectively managing chronic conditions such as diabetes and heart disease.

Patient Benefits

According to the Times, Boeing officials said there are numerous incentives for using Preferred Partnership, including lower paycheck deductions to pay for care, larger company contributions to Health Savings Accounts, no co-payments in many cases for visiting primary-care doctors and 100% coverage for generic-drug prescriptions.

Provider Efficiencies

One benefit to the providers is access to more patient data. Because Boeing is paying the costs, the company can share that data with providers, which can then try to determine the cheapest, most effective approaches.

The Providence-Swedish ACO includes the network’s clinics and hospitals, as well as The Everett Clinic, Pacific Medical Centers clinics, The Polyclinic, Proliance Surgeons and others. Some members of the UW Medicine network are Seattle Children’s Hospital, Seattle Cancer Care Alliance and the Overlake and Northwest Hospital centers and clinics.

The disintermediation of healthcare delivery continues.