Florida Blue and the nation's second largest public healthcare system are launching a clinical integration program in South Florida with a bold bet on the evolving frontier of paying for value.
The recently rebranded and restructured Blue Cross mutual company is adopting a "value-based compensation structure" with Memorial Healthcare Systems, a network of six hospitals, numerous clinics and a large physicians group.
Without offering many details on the nature of the agreement and its compensation model, the organizations said they want to focus on optimizing preventive care, avoiding poor care transitions, and eliminating redundancies, in part through more consumer education and more transparency.
The deal involves six hospitals, including the flagship 700-bed regional facility and Joe DiMaggio Children's in Hollywood, and more than 1,000 Memorial Health Network primary care docs and specialists in greater Fort Lauderdale and Miami, about 925 of them independent and about 150 employed by the health system.
"As one of the largest healthcare organizations in the nation, Memorial Healthcare System is an important ally in helping to create a delivery of care model that seeks to eliminate the fragmentation of care, focuses on quality outcomes, and reduces the cost burden for all stakeholders," Florida Blue chairman and CEO Pat Geraghty said in a media release. He worked at Blue Cross companies in Minnesota and New Jersey before coming to Florida in 2011.
Memorial Healthcare System president and CEO Frank Sacco said he thinks the delivery network is "among the organizations that are on the forefront of innovative healthcare, providing quality care while helping to reduce costs."
After becoming an officer in Army Medical Service Corps, Sacco started working at the public hospital system (chartered as the South Broward Hospital District) 40 years ago, and has been CEO since 1987. He's been working in healthcare long enough that he also thinks new kinds of compensation models represent the "future healthcare model."
In 2012, Memorial Healthcare System saw some $1.5 billion in revenue and devoted about $925 million to uncompensated care, according to the most recent annual report, and it opened its new regional hospital in 2008.
The deal is one of 10 accountable and collaborative care projects Florida Blue is working on. The insurer is also tackling the challenge of electronic medical record integration with Greenway Medical.