New Commercial PPO in California Built on Value-Based Insurance Model

NASHVILLE, Tenn., Nov. 5 /PRNewswire/ -- HealthLeaders-InterStudy, a leading provider of managed care market intelligence, reports that SeeChange Health, the first start-up health plan in California in recent memory, is rolling out this fall with a value-based insurance design model that ties benefit design to achievements in wellness. According to the new California Health Plan Analysis, the plan is targeting the fully insured small-business market in the Fresno area where it will compete with Kaiser Foundation Health Plan and Anthem Blue Cross. The company plans to expand to San Francisco and Los Angeles in the coming months and into Colorado and Illinois next year.

SeeChange is incorporating value-based insurance design into a full service PPO covering outpatient services, hospital care, physical therapy, mental health and prescription drug benefits under which members will be incentivized to manage chronic conditions. Members can reduce their coinsurance to zero and reduce out-of-pocket expenses by meeting certain criteria, including seeing their physician for an annual wellness visit.

It is more common to see health plans and self-insured businesses employ value-based insurance design with pharmacy benefits, lowering copays for drugs deemed most effective in treating chronic conditions. For instance, statins might be free for heart disease patients. But value-based design is becoming a broader movement that combines financial incentives with evidence-based clinical guidelines to foster the improvement of health outcomes of insured populations.

"We are starting to see more health plans incorporate value-based insurance options aligned with pharmacy benefits, but SeeChange is upping the ante by offering a full-service PPO that is actually built on this value-based insurance design model," said Chris Lewis, analyst with HealthLeaders-InterStudy. "Starting a new PPO is a bold move in today's economy, but SeeChange's model smartly recognizes the importance of getting ahead of the value-driven trend that is top-of-mind in healthcare reform efforts."

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