Strong Health and Blue Cross Sign Agreement

Contract will provide care to 70,000 patients under Blue Choice

July 21, 1998

Strong Health's Managed Care Organization (MCO) has signed a letter of intent to enter into a three-year contract with Blue Cross and Blue Shield to provide care for approximately 70,000 Blue Choice enrollees whose primary care physicians are affiliated with Strong Health. The contract creates a partnership between the Strong Health MCO, Blue Cross and Blue Shield, and the Rochester Independent Practice Association (RIPA) while aligning incentives among hospitals and physicians. It represents Rochester's largest full risk-sharing contract between an insurer and an integrated delivery network to date, while allowing patient access to a community-wide panel. "We are pleased to be able to work in partnership with Blue Cross and RIPA on an arrangement that benefits our community," said Anthony L. Suchman, M.D., chief medical officer and CEO of the Strong Health MCO. "This contract gives us incentives to develop new, collaborative approaches that improve the quality of health care. It also makes our doctors and hospitals more accountable for controlling health care costs." The contract, which will be effective January 1, 1999, limits total health care expenditures, but also grants greater responsibility to the Strong Health physicians and hospitals for decisions about medical management and financial incentives. The plan is expected to improve quality for the Blue Choice enrollees of participating physicians, but there will be no change in benefits or in their access to the full realm of providers within the Blue Choice RIPA panel. "Providing quality health care, at an affordable price, with a community-wide panel of physicians is what has made Blue Choice Rochester's number one health plan," said David H. Klein, president and COO of Blue Cross and Blue Shield of the Rochester Area. "This three-year agreement will help Blue Choice continue to enhance its performance." The Strong Health MCO is a joint venture involving the Strong Health system and its three practitioner group partners: Highland Physician Organization, Rochester Community Physician Organization, and the University of Rochester Medical Faculty Group. The Strong Health system was formed in 1995 with the affiliation of Strong Memorial and Highland Hospitals. Today, the system has grown to include the Eastman Dental Center; The Highlands at Pittsford; Children's Hospital at Strong; and nearly 900 affiliated physicians. Later this summer, Visiting Nurse Service, Monroe County's largest licensed home health agency, is expected to join Strong Health. Blue Cross and Blue Shield of the Rochester Area, an Excellus Company, provides health insurance coverage in Rochester and the six surrounding counties of Monroe, Wayne, Livingston, Seneca, Ontario and Yates counties. More than 800,000 people are covered by the company's insurance products.

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