Steward Health Care System, the largest integrated community care organization and community hospital network in New England, announced last week that it is teaming with Tufts Health Plan to create a community hospital network health plan aimed at dramatically deceasing health insurance costs for small businesses.
"Massachusetts small businesses are the engines of our state's economy and our best potential source of new jobs. However, small businesses have been crippled by the constantly escalating cost of providing health insurance to their employees," said Ralph de la Torre, MD, CEO of Steward in a press release. "By creating a comprehensive, benefit rich product at a reduced price, we hope to provide relief to businesses that are struggling to find a way to maintain their health insurance and reinvest in their businesses."
[See also: Steward Health looks to acquire troubled Rhode Island hospital; Harvard Pilgrim, Tufts scuttle merger talks]
Called Steward Community Choice, the heath plan is designed to provide the majority of care in physicians offices and community hospitals at a price that is up to 30 percent below current market rates for a comparable benefit design. Plan members will receive comprehensive coverage with no coinsurance and copayment between $15 and $20 for most office visits. If approved by the Massachusetts Division of Insurance, the plan will go into affect Jan. 1, 2012.
According to de la Torre, Steward is able to offer the low-cost insurance product because the health system, which has facilities in 85 towns and cities, has successfully created an integrated system that leverages data among all its locations. It has also negotiated contracts with Massachusetts General Hospital (MGH) and Brigham and Women's Hospital in Boston, if care can not be delivered within the Steward network. Tertiary-level pediatric care will be provided by the MGH for Children.
"We are pleased to be working with MGH and BWH, their participation in the network assures access to world-class tertiary care for buyers of this product," added de la Torre. "These two hospitals also share our commitment to maintaining the long-term affordability of the product."
The health plan is aimed at a market segment that typically suffers from high rates of uninsured. According to the U.S. Census Bureau, more than one quarter of the uninsured – roughly 12.5 million people – are employees of businesses with fewer than 50 employees.
Tufts Health Plan will provide administrative support and claims processing for the new plan, which is consistent with its role in the market.
"Through this agreement with Steward Health Care, we are introducing a product that offers a real choice for lower cost coverage of high quality healthcare," said Tufts Health Plan President and CEO James Roosevelt Jr., in a prepared statement. "This community-based solution to rising costs will provide significant savings to both employers and employees and is consistent with Tufts Health Plan's history of being an innovative leader in the healthcare market."