In the news
New health insurance plan comes to Fresno
SeeChange kicks off with rewards for
health changes.
By Barbara Anderson, The Fresno Bee
March 20, 2010
A startup San Francisco-based insurance company is launching a new health plan Monday in Fresno that offers cost savings to people who change health behaviors and manage chronic diseases.
SeeChange Health received approval last week from the California Department of Insurance to begin marketing a "value-based" insurance plan that rewards people for seeing their doctor.
Insurance regulators "believe this is the first of its kind in California," said Jason Kimbrough, a spokesman for the state Insurance Commissioner.
SeeChange CEO Martin Watson said the company raised $400 million from Psillos, a New York private equity company, to start the health company.
The company is focusing first on small- to midsized employers, Watson said. Fresno had the right mix of employers, he said.
"It's a product that will help bring small employers back into offering insurance in the marketplace," he said.
Nicole Evans, spokeswoman for the California Association of Health Plans, said she had no information on SeeChange to compare it with other health plans. But programs to encourage prevention of diseases have expanded over the years, she said.
"It sounds like they're trying to build on some of the best practices in managed care to help bring down costs and to improve overall health," Evans said. The association represents health-maintenance organizations in California that serve about 21 million people.
The SeeChange plan encourages enrollees to take advantage of health screenings and health tests to catch problems before they become serious. The company pays 100% for preventive care. Enrollees who comply save money on health premiums and out-of-pocket costs.
When individuals enroll in the plan, they are asked to answer a health questionnaire that includes questions about height, weight, gender, ethnicity, as well as health behaviors, such as smoking, said Janice Rahm, executive vice president of product and marketing for SeeChange.
Based on the answers on the questionnaire, the company asks participants to agree to preventive screenings, including cancer screenings and laboratory blood tests to detect health problems, she said.
Participation is voluntary, but those who agree receive a benefit equal to cutting their out-of-pocket co-insurance costs by 10%, Rahm said. The company also deposits $200 into a health-incentive account that can be used to help pay drug co-payments and other costs, she said. Spouses also can be eligible for a $200 incentive.
The concentration on prevention saves SeeChange money, Rahm said. "Our whole model is built on the premise that early detection and proactive health management drive down costs," she said.
SeeChange studied health conditions and costs associated with medical treatment, said Watson, the chief executive officer. For example, a person diagnosed with early diabetes has an average of $6,000 in medical costs annually, Watson said. Someone with later-stage diabetes on average has $15,000 to $20,000 in medical costs. The cost difference for treatment of Stage 1 colon cancer versus Stage 3 colon cancer: $12,000 a month, he said.
The plan's cost to employers is competitive with other health plans, Watson said. The company believes it can keep premium increases low, he said.
"Fresno could really use a new entrant that is a competitively priced product that isn't going to jack up rates 40% every year," he said.
Source: http://www.fresnobee.com/2010/03/20/1866972/new-health-insurance-plan-comes.html
