Intel creates an ACO-style narrow network for its workers

Officials: Contract with Presbyterian Healthcare will boost care coordination

Intel has partnered with Presbyterian Healthcare Services to offer a narrow-network, accountable care-style benefits plan to employees at its Rio Rancho, N.M., facility, Modern Healthcare reports.

The California-based, self-insured software company opted to work directly with the system this year rather than with a national insurance plan to administer benefits for some of its eight health plan options.

The arrangement offers about 5,400 Intel workers a narrow network of Presbyterian providers as two of its four health plans. Enrollees in the narrow-network plans will pay more if the seek treatment elsewhere.

The new model will allow the health system to better manage care, says Tami Graham, Intel's global benefits design manager. Outside the network, Intel workers are "getting care that's not coordinated and may not be in their best interest," she explains, adding that Presbyterian's physicians can better hold down costs when patients do not seek care at independent or rival providers.

Intel estimates that the partnership—which launched in January—could save between $8 million and $10 million through 2017, Graham says.

Presbyterian, which currently runs a clinic at Intel's Rio Rancho manufacturing plant, will receive bonus payments if it meets quality benchmarks and keeps Intel's employee health costs under a set limit.

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The partnership is Presbyterian's first employer-driven ACO, says Lauren Cates, a senior vice president at the health system. She says that health system officials were eager to gain experience with a large, innovative employer that could help position them for more direct contracts with other businesses. "We believe there's a lot of potential for this in the future," she adds.

A broader industry trend?

According to Modern Healthcare, Intel's ACO contract is more sweeping other major employers' direct provider contracts, which typically are limited to specific procedures and conditions.

Helen Darling, president and CEO of the National Business Group on Health (NBGH), said employers contracting directly with providers is the "next logical step," adding, "It should have been done earlier, but it's not as easy as it sounds.

An NBGH survey found that just 7% of 583 large employers are engaging in direct contracts, although another 6% plan to do so in the next year (Evans, Modern Healthcare, 7/13 [subscription required]).

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