Hartford Business Journal

10 Hartford Business Journal • January 13, 2020 • www.HartfordBusiness.com By Matt Pilon mpilon@hartfordbusiness.com O ne of the country's largest health insurers is looking to solidify its Connecticut mar- ket share with the help of a relatively novel product aimed at small employers — a segment desperately looking for affordable coverage amid ever rising rates. On Jan. 1, UnitedHealthcare debuted its "NexusACO" offering in Connecticut and several other New England states. The plan, first launched nationally in 2016, was ini- tially targeted at self-insured large companies, but is now aimed at the fully insured small and large group markets in Connecticut, Massachu- setts and Rhode Island. NexusACO is unique because it combines two relatively new care concepts. First, it's a "tiered" prod- uct, which means it groups hospitals and doctors by cost and quality metrics and incentivizes consum- ers — through lower premiums or copays — to visit providers offering the best bang for their buck. That type of health plan has be- come increasingly popular in other states, but Connecticut has been slow to adopt it, as employers and workers here have generally shown a preference to pay more in premiums to access broader doctor networks. NexusACO also involves an "ac- countable care organization," which is an affiliated group of providers who agree to work together to care for a patient population at a certain price, with additional potential rev- enue tied to meeting benchmarks for quality outcomes and costs. That's opposed to the much more common "fee-for-service" model that reimburses doctors and hospi- tals for each procedure and test they perform, which some say leads to higher healthcare costs. NexusACO has an exclusive con- tract with St. Francis Healthcare Partners Network, which includes over 1,000 providers and acts as the plan's top tier, meaning patients will be steered there through lower out- of-pocket costs. The plan also enrolls companies with as few as two workers. Such micro employers, with five or fewer employees, often get ignored by pri- vate insurers and have the hardest time finding affordable coverage. UnitedHealthcare of New England President Stephen Farrell said tiered health plans aren't common in Connecticut because "they haven't delivered the value." But he's hoping NexusACO can help change that, especially as steadily in- creasing premiums and out-of-pocket costs have made it more difficult for small employers to be competitive when it comes to offering affordable and quality health benefits. Other tiered health insurance prod- ucts exist in the state. For example, An- them, UnitedHealthcare's chief Con- necticut rival, offers a tiered hospital plan, which doesn't include physician groups like the NexusACO plan. Farrell said NexusACO will stand out because its premiums are 10 to 15 percent lower compared to com- peting options, and also because of its structure. Dr. Ronald Kimmel, chief medi- cal officer at St. Francis Healthcare Partners Network, said Connecticut employers and health consumers have mostly been resistant to plans that limit provider networks. However, he's noticed a renewed push by insurers to offer such plans. "We're seeing more and more that these narrow networks are going to become more common," Kimmel said. "The cost of health care is getting so UnitedHealthcare's covered lives in Connecticut: Small group: 65,000 Large group: 326,000 Medicare Advantage: 85,600 * Data includes both fully insured and administrative services for self-insured plans. Source: UnitedHealthcare; Medicare data from Kaiser Family Foundation as of 2018. Bending the Cost Curve Novel health insurance plan aims to provide small employers more affordable coverage; skeptics remain PHOTO | HBJ FILE

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