In September 2020, Horizon Blue Cross Blue Shield of New Jersey (BCBSNJ) and Hackensack Meridian Health (HMH) announced the formation of Braven HealthSM, a Medicare Advantage plan serving eight New Jersey counties.* HMH and Horizon BCBSNJ will also be working with RWJBarnabas Health (RWJBH) in this collaboration, pending final approval from the New Jersey Department of Banking and Insurance. Barry H. Ostrowsky, President and Chief Executive Officer of RWJBarnabas Health, recently responded to questions posed by MDAdvisor staff about the benefits and challenges of this type of partnership.
MDADVISOR: What has been going on in the healthcare environment, and in particular the health insurance sector, that has made it enticing for health systems like RWJBarnabas Health to partner with an established health plan?
OSTROWSKY: I come at this question, perhaps, from a slightly different point of view from many of my colleagues. Over the years, I’ve always viewed health insurance companies as our customers. We would have our share of adversarial negotiations, but at the end of the day, they are the ones who paid us for services rendered to their subscribers. I have always tried, maybe not always successfully, to cultivate a relationship between the provider side and the payer side. Over time, what you find out is that no matter how close that relationship becomes, each side is incentivized to do what is more or less exclusively to the advantage of our individual organizations. Although we can share things intellectually, it is very difficult to build an effective partnership when what you have is really a vendor relationship.
MDADVISOR: Had you ever considered developing your own health plan?
OSTROWSKY: Over the years, we have contemplated having our own health plan for public consumption, but when you sit down and go over the regulatory requirements, it’s very expensive. We had ongoing discussions with a variety of insurers about creating an effective partnership where the license of the insurer would, in effect, be an asset of the partnership, and we would help promote it. The idea never really got off the ground for various reasons, and then this opportunity came along.
MDADVISOR: How did the Braven HealthSM partnership come about?
OSTROWSKY: Braven HealthSM represented an opportunity that all three partners viewed as truly a good one. Both Hackensack Meridian Health and RWJBarnabas Health have a very good working relationship with Horizon. We’re both Tier 1 providers in their Omnia structure, and I think we are big enough to be partners with Horizon. In the discussions that led to this partnership, we sat down as business people and said, “What’s the advantage to each of us? What are we going to derive from this? Are those advantages sound for both our businesses and for the delivery of healthcare?” That was the evolution. Horizon wanted to get the benefit of what we know about providing care.
Most Medicare beneficiaries in New Jersey have basic Medicare and then buy some kind of added offering to wrap around that. So, there hasn’t been great traction in selling Medicare Advantage coverage to the general population, and that market opportunity is clearly attractive to Horizon. If Hackensack Meridian Health and RWJBarnabas Health are invested in the success of this particular product, and marry the trust we have in the marketplace to Horizon’s trust, there would be a greater chance for Medicare beneficiaries to be attracted to this particular Medicare Advantage plan.
MDADVISOR: What do you view as the advantages of this type of partnership?
“If you get the payer and the provider to really be aligned, you will end up with a better product.”
OSTROWSKY: Braven HealthSM presented an advantage to Horizon and to our two healthcare systems. I think we felt that being on the inside of a health plan, we would have a greater understanding and ability to help design how care is reimbursed and to prioritize the kind of care that is appropriate. This would be advantageous to us, and we’d be able to offer a product to our communities, in this case Medicare beneficiaries, that supports the mission we have, which is to care for our patients appropriately. I mean that sincerely; if the coverage was not appropriate, we would not be in this because it would not be worth it. I never want to have our status in the community reduced because we are associated with a product that isn’t appropriate for the buyers, our patients. Perhaps this sounds naive, but if you get the payer and the provider to really be aligned, you will end up with a better product.
MDADVISOR: In 2019, there were roughly 16 payer–provider plans, and 12 of them were cobranded. This year it looks like there are approximately 22 of them nationally. Do you think that in New Jersey, or even nationally, the concept of this particular type of provider–payer plan is a disruptor, or do you think it is similar to what’s already out there?
OSTROWSKY: When you use the term “disruptive,” what you are really talking about is a change in the normal environment. In this case, the normal environment was basically having the payer on one side and the provider on the other, with the beneficiary in the middle. Certainly, it would seem that a model that takes the payer and the provider and puts them in a partnership together disrupts the status quo.
This is a time when insurance companies are trying effectively to convey some of the risk (or at least offload some of the risk), and health systems are willing to take on some of that risk, so the partnership concept suits their needs and desires and ours. That is why you’re seeing this model now. Most provider organizations would like to get out of the vicious cycle of contentious negotiations with payers.
There have been a number of provider-owned plans that aren’t in partnerships with insurance companies, and those have had rocky success or histories. Some have closed, and some have incurred great losses trying to compete with well-established insurance companies. For me, without having an insurance company as a partner, the concept doesn’t look particularly attractive. Partnering with a payer provides a much greater chance for success. I think if this is the right platform, then you’ll be seeing a lot more of it. Our first open enrollment period started October 1, 2020, and it will take a while to really evaluate it.
MDADVISOR: What is the importance of data sharing in a partnership like Braven HealthSM?
OSTROWSKY: At RWJBarnabas Health, we truly want a partnership, even a custodial relationship, with the consumer. So, if we want to do for the consumer that which we all believe will help make the consumer healthy, then we need to understand the data behind it. I don’t just need the data that we’ve accumulated on our own over time. I also need the data from insurance companies, and I need a certain amount of actuarial insight. This is an important benefit that comes from the partnership between a provider and an insurance company.
Considering the advances that have been made with artificial intelligence and the science of big data, it’s amazing what the data will tell you, at least directionally—if not down to some level of granular specifics. We will be far better informed about how to care for the patient and what services are needed. If we’re not going to commit ourselves to that, then we’re not really doing the job that we set out to do.
As we better understand the data, and as we better understand the demands that are placed on insurance companies by various groups of users and beneficiaries, we are better able to design a benefit package. I want to be able to go to the third-party payer and say, “Look, the benefit package really ought to include the following elements that aren’t in there now. We need you to help fund us in a way that doesn’t necessarily have to cost any more money but helps us deliver these additional or previously unpaid benefits, because in the end that will mean that the patient will be healthier.” For example, I really think that we should be offering socially driven benefits. For a long time, I’ve thought we should seniorize homes. There is no Medicare code for seniorizing a home, but if this doesn’t happen, the senior citizen may fall and fracture his or her hip.
For years, insurance companies basically said that the reason they’re not nearly as serious about wellness as they should be is because subscribers change insurance companies every X number of years. If you teach a subscriber to be healthy, you may not get the benefit of it as an insurance company, because that subscriber may end up being a subscriber of some other insurance company X number of years down the road. I don’t believe that this is a terribly persuasive argument. In my view, it’s going to be our responsibility to keep the patient healthy irrespective of what insurance he or she has. I want to start integrating into the delivery of healthcare the social programs that deal with social determinants and other issues. That is an advantage we’ll have that will be informed by a lot of the data that insurance companies collect.
MDADVISOR: With all of this data available, do you anticipate identifying actionable items that the care providers will need to pay attention to?
OSTROWSKY: Absolutely. There are actionable items beyond conventional clinical care that we already know about, but don’t currently ask our patients about. Admittedly, a lot of this is unfair for the physician who has been trained in a conventional clinical way to ask questions and provide diagnosis and therapy. We’re now saying to the physician, “Would you please also ask about behavioral health issues? Would you also please ask about social determinant issues?” The more that we have a physician ask about these other events or conditions in patients’ lives that are outside conventional clinical training, the more we can provide the kind of care that particular patient needs. This is a brand-new notion for the most part. But the medical schools haven’t trained physicians to do this. We need to train the physicians, get the additional data and construct what is necessary for the patient. We’re changing several hundred years of practice, so it is not easy, but you have to start somewhere.
MDADVISOR: How does the shift to value-based care and reimbursement impact fit into the conversation?
“Organizations like ours, the big systems of New Jersey, should be mission-driven to put out the best possible product. We should not be driven exclusively by the financials. I really believe that.”
OSTROWSKY: I believe the move to value-based care is important regardless of the payer–provider partnership. Of course, it turns out that if you’re providing more valuable care, and if you’re providing care that’s better designed to help the patient, it will eventually be financially beneficial to the provider. If you are going to wean yourself off fee-for-service reimbursement by bundling a bunch of services, the finance people will make the calculation and say, “You’re leaving money on the table because now you’re no longer able to bill à la carte,” but to me that’s a short-term phenomenon.
I think if you’re not going to build the best product, and if you’re not going to build the most valuable intervention, eventually you’re not going to have any revenue anyway. I think value-based care needs to be one of the driving forces behind all that we’re doing. The product and the services ought to be based on value, and value shouldn’t exclusively be measured as financial efficiency. I don’t want to put out a flawed product just for the sake of getting more revenue. That doesn’t make any sense. It’s inappropriate, and organizations like ours, the big systems of New Jersey, should be mission-driven to put out the best possible product. We should not be driven exclusively by the financials. I really believe that.
MDADVISOR: How are healthcare providers directly involved in this program, and how does that involvement benefit consumers in the long run?
OSTROWSKY: I think it’s important for the consumer to know that we as providers have a say in how the business is being administered and how the benefits are structured for delivery. Let’s face it, most patients and subscribers love to blame the insurance company. It’s always the insurance company’s fault. One of the things we had to consider in this partnership is that we’re now a partner in the insurance company. We’re saying to the consumer, “Trust us. We’re involved in this payer–provider health plan, and we’re not going to allow any single idea to overtake what’s best for you. You should know that we as a provider have this important say in how the care is rendered.” I think if we convey that message effectively, it will be persuasive. That person will blame us for not living up to the representation that we’re going to make a better service and an easier, more accessible and consumer-friendly healthcare experience.
MDADVISOR: What do you think are the greatest challenges in developing this kind of payer–provider collaboration?
OSTROWSKY: I think it starts with developing the right partnership so that you can make the endeavor successful and all organization partners satisfied. There is a fine line between making a particular endeavor successful and using that endeavor to make our individual companies successful. Those are two different goals. If we’re convinced that the successful endeavor will lead to the benefit of the partners, that’s fine. If you have to choose between making the endeavor successful and making an inuring benefit to the owner, you’re in trouble. I believe on paper we’ve overcome that. We’ll see in practice whether that’s the case. At some point you have to stop negotiating and act like partners. Not every partnership makes that conversion. We’re not likely to put United Healthcare out of business because we’ve launched a Medicare Advantage plan, but I think it can be successful, and I think it will be good for everybody.
MDADVISOR: Do you think that the concept of Braven HealthSM can extend from Medicare to other programs?
OSTROWSKY: I do. The easier part of a Medicare Advantage plan is that Medicare is kind of in charge. If you move it away from Medicare, now you are dealing with mostly employers, all with their own individual needs and issues. It may not be as easy, but I think at some point we can do it.