Blue Cross Blue Shield of Texas wants to do more than just pay health care bills. The state’s largest health insurer is getting into the provider business.
Its goal is to lower health costs, improve care and reach some of the many Texans who don’t have insurance or a medical home.
Texas consistently ranks worst in the nation in the uninsured. Last year, just over 5 million Texans had no health coverage, almost 2.2 million more than runner-up California.
Blue Cross is teaming with Sanitas, a multinational health care company, to open 10 retail health clinics around Dallas and Houston. The outlets will provide primary care and urgent care, including X-rays and lab services. They’ll also offer weekend hours.
“There’s going to be a revolution in how primary care is delivered to consumers,” said Dr. Dan McCoy, president of Blue Cross Blue Shield of Texas. “We felt that we needed to play a part in that system, too.”
He pointed to a surge in retail clinics nationwide, including in pharmacies, strip centers and other settings. Last year, an estimated 2,800 such clinics operated in the U.S., twice as many as six years earlier.
Walmart opened health clinics in three states, including Texas, and recently opened a large center in Georgia with counseling and dental care. CVS Health, which acquired Aetna a year ago, plans to have 1,500 health hubs operating by the end of 2021. Amazon just launched a virtual health clinic for employees and is working with J.P. Morgan and Berkshire Hathaway on a broader effort to reduce health costs.
The number of retail clinics nationwide could double over the next several years, said real estate firm JLL. Their cost of care is lower and many are more convenient, JLL said in a 2019 report, yet they accounted for just 2% of primary care encounters.
Most Blue Cross-Sanitas clinics will open in coming weeks, officials said. On Friday, the companies held an open house at a clinic in Richardson, not far from Blue Cross headquarters, and more than 50 people toured the revived facility at 350 S. Plano Road.
It’s in a former urgent care clinic, located at the end of a strip center, across from a Lowe’s store. The 7,300 square-foot office has 10 exam rooms and a separate area to sign up for health insurance.
Blue Cross is opening two clinics in Irving and one in Mesquite, along with six around Houston. The insurer did not select areas with the most Blue Cross members, McCoy told the crowd.
“We picked locations where people had the highest rates of the uninsured,” McCoy said.
The company is taking on two tough issues: the uninsured and the high price of treatment. The clinics will emphasize value-based care, which reimburses providers for keeping patients healthy, not for doing more services.
“We believe that primary care is the cornerstone to offering value,” McCoy said.
Some doctors are concerned about the additional competition, he said, but Texas has a booming population and a shortage of providers.
Just over 1 in 4 Texans said they had no place to go when they’re sick except for the emergency room, according to a 2018 survey. More than half the uninsured said they had no medical home.
Many families, even with insurance, struggle with health costs, and over half of Texans skipped treatment because of the price. Blue Cross will offer health plans with Sanitas that have no deductibles or copayments, and they hope to sign-up thousands during open enrollment on HealthCare.gov.
Blue Cross has to get creative because costs are rising from all directions, said Vivian Ho, director of the Center for Health and Biosciences at Rice University’s Baker Institute for Public Policy.
“It’s a terrific idea,” Ho said about the Blue Cross effort. “Their goal is not to maximize the price of a clinic visit. They care about controlling costs and filling a hole in community health.”
Blue Cross is entering the new business cautiously, and it’s been burned before. In 2014, after the Affordable Care Act took effect, Blue Cross led the way in expanding coverage for the individual market. But it lost over $1 billion in the first two years of Obamacare so McCoy will let the market point the way.
“We have our sights set on other communities, but we certainly want to see how this is accepted and how we perform,” he said.
Sanitas began in Colombia in 1980 and grew steadily through Latin America before expanding into the U.S. five years ago. It teamed with GuideWell, parent company of Florida Blue, and initially designed products for customers on the health exchange.
Sanitas has 23 locations in Florida, serving 200,000 patients, and plans to open 11 more outlets by January, said Mark Strickland, who’s leading the Sanitas effort in Texas. Sanitas also has clinics in New Jersey and Connecticut.
Strickland compared Sanitas’ approach to Kaiser Permanente’s vertically integrated system in the West, which includes an array of providers and facilities, along with an insurance plan.
Sanitas has a track record of providing high-quality, low-cost care in many communities, said Dr. Paul Hain, chief medical officer for Blue Cross. And teaming with such partners is important, even for insurers.
“We know the future of health care is increasingly collaborative,” Hain told the crowd on Friday. “This is where we really wanna be.”