ACA premiums will shrink for some

For the first time since the passage of the Affordable Care Act (ACA), some North Carolina residents who purchase health insurance through the insurance exchanges will see a decrease in their premium by an average rate of 4.1 percent. Unfortunately, not all the purchasers of ACA plans will get a reduction — some will see an increase of up to 9.5 percent — however, this is a significantly better rate adjustment than in years before. This rate reduction for ACA plans was made possible by an alliance between UNC Health Care and Blue Cross Blue Shield of North Carolina (BCBSNC):

“Our agreement with UNC Health Alliance allows us to offer similar plans, but at a significantly lower cost,” said Patrick Conway, President and CEO of Blue Cross NC. “What makes this possible is that UNC agreed to partner with us on an arrangement where we’re both responsible for the quality and total cost of care. We will work with our current Blue Local customers to find in-network providers, and make sure they are getting the care they need throughout this transition.”

Pre-subsidy premiums will be less, but some customers will need to change providers in order to take full advantage of the cost reduction. Through Blue Cross NC’s Blue Value Plan, UNC Health Alliance will be the in-network provider for Blue Cross NC’s ACA plans in the Triangle. Blue Value with UNC Health Alliance will be available in Wake, Johnston, Franklin, Lee, Chatham, Alamance, Orange, Durham, Caswell and Person Counties.

In some cases, alliances such as this one will shift the consumer power away from the patient, towards the provider and the payer of health insurance. However, both UNC Health and BCBSNC assume the responsibility to provide healthy patient outcomes. This is known as value-based care. The amount of money that UNC health is set to make (or lose) is based on how closely they meet the health quality measures that are determined by both parties before they enter into an agreement. Exceeding quality measures could result in extra payments for UNC Health from BCBSNC and falling short could result in UNC Health owing money back to BCBSNC.

Such payment structures promote a better relationship between the patients and physician because there are incentives for the providers to promote better health outcomes. In traditional fee-for-service payments, the doctor has no incentive to restrict care, or worry too much about outcomes because they know payments are based on the number of services performed, not how healthy people end up after treatment. In value-based care, the physicians can work in a partnership with the payer to reduce overall costs while also promoting the best health outcomes possible.

The future of healthcare delivery needs to focus on improved health outcomes, reducing overconsumption, and reducing overall costs. In a world where the ACA mediates almost all things healthcare, alliances such as this one between UNC Health and BCBSNC aim to do all of those things by operating under the incentives of value-based care.

Jordan Roberts / Health Policy Analyst

Jordan joined the Locke Foundation in the summer of 2018 as Health Care Policy Analyst. He analyzes state and national health policy issues with an eye toward removing governm...

Reader Comments