And Away We Go…

I wonder how many readers of this post recognize the throwback to the Jackie Gleason Show?

We didn’t have to wait long to see an example of the transformational changes that will impact the health care “system” over the coming years. Just look about 100 miles up I65. Indianapolis-based and soon to be renamed Clarian Health System, is planning to start its own insurance plan. (Click here for Indianapolis Business Journal article.)

While fraught with risk (most health systems have a poor record managing insurance risk), the hospitals, physicians and other providers making up Clarian have much to gain from such a bold move. Area employers and their employees do so as well.

Integrating the health care delivery system and its financing is the logical next step and is being facilitated by various provisions of the recent reform act. The act provides for the establishment of accountable care organizations, contemplates bundling payments to provider for certain conditions (that means Medicare makes one payment for physician fees, hospitalization and aftercare to a single entity which then decides how to apportion the payment) and ties payment levels more closely to quality and outcomes. It look like Clarian believes it can become an ACO under this approach.

So, what about Louisville. Which system might take this step? Well here are some facts about Clarian:

Clarian has 16 hospitals in the state of Indiana, about $2.5 billion in revenues, plans to employ 1,200 to 1,500 physicians through the Indiana Clinic, has the latest health care information technology and has good geographic coverage of the Indianapolis market. Clarian, which will change its name to Indiana University Health in 2011, has a strong medical school affiliation and is a major employer in and around Indianapolis. In Indianapolis, Wellpoint/Anthem dominate the Indianapolis market in much the same way and Anthem and Humana do in Louisville.

It will certainly be interesting to see who makes the first move to bring the delivery and insurance systems together in Louisville, particularly with the unsettled environment in the downtown medical center.

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