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Sutter, Health Net agree on new contract; Blue Shield contract expires, negotiations continue

As the clock ticked down the last hours of 2016, Health Net and Sutter Health were able to come to agreement on an extension of their current contract, extending Sutter Health’s in-network status for most Health Net plans.

With the turn of the calendar to 2017, the contract between Sutter and Blue Shield of CA has expired, although the two health giants continue to negotiate. Full text of notifications from the carriers are posted below.

From Health Net senior account executive (12/30/2016):

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Blue Shield of CA Switching to CVS for Pharmacy Management

Blue Shield recently notified policyholders of the upcoming change to their pharmacy network benefits. The details in full are outlined below. Please review, and contact Allpointe if you have questions about how this may affect your pharmacy coverage. The change will take effect January 1, 2017 regardless of when your plan renews.

 

Blue Shield has entered into an agreement with CVS Health to support manufacturer rebate and pharmacy network contracting for the outpatient pharmacy benefit, which has been approved by the Department of Managed Health Care.

CVS Health will manage Blue Shield’s national retail pharmacy network, and become our exclusive mail order pharmacy for Commercial and Medicare plans and our specialty pharmacy for Commercial plans, starting January 1, 2017.

This new agreement will enable us to leverage CVS Health’s purchasing power and reduce pharmacy costs. It will allow us to offer more competitive pharmacy products while continuing in our commitment to provide access and convenience for our members.

Who is affected?
The new pharmacy network changes will apply to all Blue Shield lines of business:

  • Commercial
    Premier, Core, Small Business, Individual and Family Plans (IFP) and Self-Funded/Administrative Services Only (ASO)
  • Medicare
    Individual and Group Medicare Advantage and Prescription Drug plans

Pharmacy network changes that will affect how our members access their benefits at the retail, mail order and specialty pharmacy will become effective January 1, 2017. Impacted members will be notified 60 days in advance of these changes by mail and telephone.

What are the pharmacy network changes?
There are three areas that will be affected by these changes. The member impact for most of these changes are relatively minimal and are as follows:

  • Retail pharmacy
    CVS Health will support Blue Shield’s retail network contracts. The Blue Shield network retail pharmacies will be nearly unchanged and will continue to include all key chains such as CVS, Walgreens, Rite-Aid, Costco and many others. The vast majority of our members will continue to have the same convenient access to network pharmacies near where they live and work. In fact, the network pharmacies with preferred cost-sharing will expand to include additional national retail pharmacies. Please refer to the 2017 Medicare Pharmacy Directories for more information.
  • Mail order pharmacy
    Blue Shield will transition from current mail order pharmacy, PrimeMail, to CVS Health mail order pharmacy.
  • Specialty pharmacy
    Currently, Blue Shield’s commercial specialty network includes two vendors, CVS/Caremark and Walgreens Specialty, with the majority of specialty prescriptions filled by CVS/Caremark. With the agreement, CVS/Caremark will become our exclusive specialty pharmacy for Commercial plans. Members shall continue to have the convenient access to pick up their specialty medications at a local retail CVS pharmacy. Medicare plans will continue to have an open specialty pharmacy network, which includes Walgreens Specialty and CVS/Caremark.

Transition plan
Blue Shield Pharmacy Services has been working with CVS Health to develop an implementation plan that ensures a smooth transition. As part of the plan, members who may be affected by these changes will be notified 60 days in advance of the January 1effective date.

  • For retail
    Letters will be sent to impacted members, which will provide information on up to four network pharmacies (two based on the member’s address on file and two based on the terming pharmacies address).
  • For specialty and mail order
    Letters will be sent to impacted members. Members will also receive CVS Health Welcome Kits.
  • Active specialty and mail order prescriptions
    For prescriptions that have active, remaining refills, Blue Shield will work with PrimeMail (mail order) and Walgreens Specialty (for specialty drugs) to transfer members’ remaining refill prescriptions to CVS/Caremark. Member payment information, such as credit card details, will not be transferred. Members will need to register with CVS/Caremark to provide this information. CVS will conduct a call campaign to these members to assist with registration.
  • Non-transferable drugs
    Some selected drugs are not eligible for transfer, such as Schedule 2 prescriptions. Since Federal law doesn’t allow refills for Schedule 2 prescription drugs, members using such drugs will have to visit their provider to get new prescriptions for each fill, even when using mail order.

Blue Shield of CA and Sutter Health: Negotiating a new contract

From Blue Shield today:

Blue Shield and Sutter Health are engaged in contract negotiations
Blue Shield of California and Sutter Health are engaged in discussions on rates and terms for a new network contract (HMO/PPO and in some cases, Group Medicare Advantage). The current contract is set to expire at the end of this year and without a new deal, Sutter Health would no longer be a Blue Shield in-network provider starting January 1, 2017.

We are working diligently in good faith to complete a new contract that is fair and sustainably affordable for our customers. If the network relationship terminates, Blue Shield will ensure that members have continued access to care in their area, including continuity of care for those who qualify to continue in their current course of treatment with a Sutter Health provider.

What are the lines of business affected by the negotiations?
The contracts being negotiated apply to all Blue Shield plan types, including HMO, PPO, EPO, POS-HMO Tier, POS-PPO Tier and Group Medicare Advantage.

  • Individual and Family Plans: Grandfathered and Non-Grandfathered Plans (on and off exchange)
  • Medicare: Group Medicare Advantage Prescription Drug (GMAPD) plans
  • Small Business (1-100 employees)
  • Fully Funded Large Employers (101+ employees)
  • Self-Funded/ASO Large Employers (101+ employees)
  • Self-Funded/Shared Advantage (101+ employees)
  • CalPERS
  • FEP
  • FEHBP

Sutter Health providers are located in Northern and Central California (see listing of counties below). In addition, Sutter Health has surgery centers in San Diego County.

Sutter Health Counties
Alameda Marin San Joaquin Santa Cruz Sutter
Amador Merced San Luis Obispo Shasta Yolo
Contra Costa Placer San Mateo Solano
Del Norte Sacramento Santa Barbara Sonoma
Lake San Francisco Santa Clara Stanislaus

The contracts currently being negotiated include the following Sutter Health hospitals:

  • Alta Bates Medical Center Herrick Campus
  • Alta Bates Summit Medical Center Alta Bates Campus
  • California Pacific Medical Center – California Campus*
  • California Pacific Medical Center – Pacific Campus*
  • California Pacific Medical Center – St Luke’s Campus*
  • California Pacific Medical Center Davies Campus*
  • Eden Medical Center
  • Memorial Hospital Medical Center
  • Memorial Hospital of Los Banos
  • Menlo Park Surgical Hospital
  • Mills Peninsula Health Center
  • Mills Peninsula Medical Center
  • Novato Community Hospital
  • Sutter Amador Hospital
  • Sutter Auburn Faith Hospital
  • Sutter Center for Psychiatry
  • Sutter Coast Hospital
  • Sutter Davis Hospital
  • Sutter Delta Medical Center
  • Sutter Lakeside Hospital
  • Sutter Maternity and Surgery Center of Santa Cruz
  • Sutter Medical Center of Santa Rosa
  • Sutter Medical Center, Sacramento
  • Sutter Roseville Medical Center
  • Sutter Solano Medical Center
  • Sutter Surgical Hospital North Valley
  • Sutter Tracy Community Hospital

    *Includes Medicare Advantage

In the event of a termination with Sutter and in accordance with DMHC regulations, Blue Shield of California would notify HMO members assigned to a Sutter Health Primary Care Provider (PCP) 60-days in advance of a potential termination with Sutter Health. PPO members with an out-of-network benefit could receive services from a Sutter-affiliated provider, but the out-of-pocket costs will be at the non-preferred benefit level.

Our commitment to affordably priced health coverage
Blue Shield continues its provider contract discussions with Sutter Health in hopes that new agreements will soon be reached. We appreciate your patience while we work to secure the best possible outcome for our customers and members. Our goal is to provide our members with access to quality health care at an affordable price.

Emergency services
Blue Shield of California members who need emergency services should call 911 or seek care at the nearest emergency room. Blue Shield will provide the full emergency care level of benefits for these services.

Oscar is coming to San Francisco

Oscar is coming in 2017. No, not that Oscar.

A new health insurance carrier will offer plans both on- and off-exchange, in San Francisco, San Mateo, and Santa Clara counties. A little surprising it took this long, considering they are Google-funded, and we’ve heard them described as “great software – with health insurance attached.”

It appears their Bay Area rates and network will be middle-of-the-pack (current word is no Sutter Health/PAMF, though that could change). Will their customer service and user experience be enough to consider Oscar as a viable choice? Stay tuned.

Reach for the stars: how to use online review sites to your advantage

The monetary impact of review sites like Yelp, Angie’s List, Google, Facebook and others can be a boon (or devastating) to both new and established businesses.

Seventy-two percent of users are willing to try a business with a 3-star rating, but only 27% of users would look at a business with a 2-star rating. Every increase in overall stars leads to a 5-9% jump in revenues.

How is this an HR issue? Reviewers share their opinions based on your product…and even more importantly, on their interaction with your team. Hiring, training, and retaining engaged employees is the key starting point to better reviews. Resolving a conflict with a customer is an opportunity to convert them into a fan for life.

To learn more, please join us for a free webinar with our partners at HR Answerlink on Wednesday, September 15th. Space is limited – click below to register today.

Allpointe-Yelp-Reviews

Register Now

 

Friends of the Urban Forest: Potrero Hill Neighborhood Planting 8/27/16

Friends of the Urban Forest has funding to subsidize up to 75% of the costs to plant trees. They handle all of the prep work, provide the tree, and do the scheduled tree care visits over the first three years of the tree’s life to help it thrive! If you are a property owner in Potrero Hill and would like to infuse your concrete sidewalk with a little green, contact FUF before July 20th, 2016 to reserve your tree. You can also call Kyle at 415-268-0772.faerie1200

The community planting day is scheduled for August 27, 2016.

Obama administration looks to curb use of short-term health plans

It is nice to know the President is reading my blog.

How else to explain today’s news that the administration is looking to curb the use of short-term plans to three months or less? Ok, I admit, maybe it was a low-level staffer at Health and Human Services who originally saw How to save $1,000 in health premiums over the next 4 months and they forwarded that up the chain of command. Still, I appreciate the implied compliment, Mr. President.

CNBC and Kaiser Health News both report today on the administration’s move to limit the maximum length of short-term plans to 3 months, without an option for renewal.

While the reasons cited are sound (only the healthiest people can obtain short-term coverage, and pulling healthy people from the overall insurance pool does ultimately raise the rates for others), short-term plans are often a last-resort option and fill a very specific need in the market.

We have clients who missed the open enrollment deadline. Their fault? Sure. But shouldn’t they be able to buy some coverage to protect them against catastrophic health expenses until the next open enrollment period?

Even more concerning, we are seeing cases of clients whose former employer screwed up in one way or another, e.g., the employer failed to pay premiums on the group health plan, employee coverage was canceled retroactively, and the employees didn’t find out until more than 60 days beyond the cancellation date. Note: 60 days happens to be the window to buy new minimum coverage following a qualifying event. Their fault? No way, but their only recourse would be to hire an attorney and hope for the best. But wouldn’t it be helpful if they could buy a short-term plan to cover the gap until they could get covered again?

You can learn more about short-term plans and whether they are right for you or someone you know, right here.