Prognosis Uncertain for New Vivity Health Plan

Vivity, a new integrated health system organized by Anthem Blue Cross, garnered headlines when it was announced last month. But the system, which is somewhat modeled after non-profit Kaiser Permanente, is not a sure success unless large employers embrace it, according to experts. The system includes seven hospitals, their affiliated doctor groups and Thousand Oaks-based Anthem, a unit of Indianapolis-based WellPoint Inc. Among the hospitals, only UCLA Health has facilities in the greater San Fernando Valley. The system is similar but not identical to Kaiser, which is composed of non-profit hospitals and physician-owned doctors groups that contract exclusively with each other. The non-profit Kaiser Foundation administers the insurance plan and handles finances. On an operational level, the hospitals and doctors use the same electronic medical record system, Kaiser pharmacies and other services. Vivity will attempt to replicate the Kaiser model by cobbling together pre-existing hospitals, doctor groups and a for-profit insurer. But Jason Sandler, partner at OHM Benefits & Insurance Solutions in Northridge, said that while Anthem has some good partners on the project, he’s not sure if the medical record sharing, billing and prescription tracking systems will be as integrated as Kaiser’s. “The hospitals all have affiliated medical groups, but does that mean every medical group with a particular hospital will participate in Vivity, or only some?” he asked. “It’s only going to work if the employers stay within the confines of those hospitals and medical groups.” Brokers started talking to clients about Vivity on Oct. 1, with coverage starting Jan. 1. Initially, the plan will be sold only to large employers, defined as 50 employees or more. Sandler said price will be a determining factor in acceptance by large employers. “They will have to keep the costs relatively low to get businesses to move to it,” he said. “They may price it artificially lower at first.” Darrel Ng, a spokesman for Anthem, said in an email that “large group prices generally aren’t published since they vary based on a large group’s census.” Also, Sandler noted that any savings from an integrated system are long-term, but employers typically stay with an insurance plan just a few years and then move on to a lower-cost alternative. “There are still a lot of questions as a broker that I need answered before I recommend this to a client,” he said. “The last thing I want to do is put my client into a disaster.” Spare $5 Million? A recent government report contained a nice payout for Apollo Medical Holdings Inc. The Centers for Medicare & Medicaid Services found that ApolloMed ACO, a subsidiary of the Glendale doctor management company, generated nearly $11 million in savings last fiscal year. As a result, Apollo will get a check for about $5.4 million. An ACO, or accountable care organization, is a group of primary care doctors, specialists and hospitals that accept collective accountability and financial responsibility to care for patients. The idea is that by working together, providers can eliminate redundancy and administrative expenses, thus lowering costs. The health reform law allows Medicare to reward ACOs with a share of the savings. Dr. Warren Hosseinion, chief executive at Apollo, said some of the savings came from fewer hospital admissions and fewer days per patient admitted. But another piece came from doctors steering patients to lower-cost hospitals, nursing homes and rehab centers. “We were surprised by what we found – a lot of doctor modified their patterns,” he said. “Keep in mind, most doctors are not used to seeing this kind of (financial) data, but they liked it and embraced it.” Hosseinion sees more savings in the future. For the last fiscal year, his ACO had only 10,000 patients, whereas now it has nearly 30,000. Also, the company is planning a technology upgrade that should cut costs. While he was pleased to get the $5.4 million, Hosseinion noted that a lot of the money will go to the people who made it possible. “Our doctors will be quite happy with the distribution,” he said. Lab Notes Valley Presbyterian Hospital has appointed Dr. Brian Ostick as director of emergency services. He is a doctor with Emergent Medical Associates, a company that has a contract with the hospital to manage its emegency room. With more than 60,000 patient visits each year, Valley Presbyterian Hospital’s Emergency Department is one of the busiest in the Valley. … Essia Health, a Woodland Hills company that installs electronic medical record software, has implemented its system at Providence Saint Joseph Medical Center in Burbank. Since 2012, Essia has installed software at 25 Providence hospitals, seven affiliated hospitals and more than 130 affiliated clinics. Providence, a Catholic non-profit, is based in Renton, Wash. … Antelope Valley Hospital held a grand opening at its Institute for Heart & Vascular Care on Sept. 18. Attendees toured the expanded cardiac and vascular catheterization laboratories, designed to provide critical and long-term heart care without leaving the Antelope Valley. The center will open for patients this month. Staff Writer Joel Russell can be reached at (818) 316-3124 or [email protected].