Sutter Health and Aetna announced plans June 13, 2017 to launch a jointly owned health plan. This new collaboration will be the first hospital-insurance company joint venture  in Northern California

This joint venture will supposed deliver “differentiated, personalized experience for members and is designed to help lower the cost of care, resulting in competitively priced products.”

The plan is projected to start offering self-insured commercial products starting by “mid-2018 in the greater Sacramento, Central Valley and Bay Area communities, as well as fully insured PPO products to follow in early 2019, with pending regulatory approval.”

As of June 2017, Sutter Health-affiliated providers care for more than three million Northern California residents. Aetna provides health care benefits to approximately 415,000 members in Northern California.

According to Healthcare Dive

The move by Sutter Health could give it more market power where increased market share could lead to increased healthcare prices.[as per a March 16, 2016 Brookings Report]

In 2012, a lawsuit against Sutter Health alleged the hospital operator “forced illegal tying arrangements and anti-steering clauses upon [commercial health insurance plans,] causing plaintiffs to pay higher health insurance premiums and other healthcare charges.” The case is still pending with the next hearing set for Jan. 18, 2018.

Aetna projects to have at least 75 percent of its claim payments in value-based models by 2020.

What will this do for prices and healthcare in Northern California?  Will this raise prices to consumers and employers?  Will this new venture be able to compete with Kaiser?  Will they have open access and participate in the Health Insurance Exchanges?  Will there actually be a transition to value-based models?   And what will those models be?  What will happen with the lawsuit?

A lot of questions and not a lot of answers


Source: Sutter Health and Aetna to Establish New Health Plan in Northern California|Sutter Health News Room