Hospitals are running out of money.

Even pre-COVID, the figures were staggering. Data from 2018 show that in California alone, a 25% drop in revenue could wipe out current assets for 25% of the state’s hospitals. As of late June, 42 hospitals have either closed or entered bankruptcy.

While the Senate bailout package passed in May 2020 provided $100 billion in relief to hospitals, little will staunch the bleeding without serious healthcare reform. Yet that reform is a huge task. Physicians and insurance companies are under serious pressure to improve quality and lower costs. Proving yet again that necessity fuels invention, some hospital systems and insurers, normally not the best of friends, have decided that working together makes more sense than not to bring about reform at the organizational level.

And so the integrated care model is here. Meant to benefit consumers and the medical community, healthcare providers and insurance companies are working together to deliver cheaper rates and those consumer benefits. Team members in New Jersey’s latest Medicare Advantage plan said this is the goal they had in mind.

Braven Health is New Jersey’s first integrated Medicare Advantage plan. The members, who will run the plan together, are the insurer Horizon Blue Cross Blue Shield of New Jersey, the large hospital system Hackensack Meridian Health, and in time, RWJBarnabas Health.

Coverage under the Braven plan, available Jan. 1, is expected to simplify healthcare delivery and improve patient care and costs, says John Doll, chief financial officer, RWJBarnabas Health. It will serve Medicare patients in 8 New Jersey counties. Braven’s Medicare Advantage offering also is expected to streamline delivery of services and the administrative side of health care.

Braven Health’s model is not new, nor is the idea of integrated healthcare. Collaboration among the major players in the healthcare lifecycle is something that took root in the 1990s when the Journal of American Medicine published an article discussing evidence for the model. As of 2018, there were 28 joint-venture plans operating in the US, with at least 9 of those being Medicare Advantage plans.

Medicare is funded through taxpayer dollars, but only pays for certain aspects of health care, like hospitalizations. It doesn't cover these expenses fully. That is why there is Medicare Advantage, which Medicare enrollees acquire through private-sector insurers. In 2018, 22% of New Jersey's Medicare recipients had Medicare Advantage coverage.

The consumer advantage

Consumer benefits could amount to better care, more personalized care options, higher consumer satisfaction, and reduced healthcare costs.

To some extent, integrated care does provide better outcomes. Researchers at Brown University have found that patients in the system, when admitted to hospitals, were less likely than patients carrying other insurance to be admitted to the general or intermediate ICU; just 12% of those in an integrated plan used an ICU, compared to just over 33% of those in other plans. Also, those with integrated care plans lived a while longer than others after release from the hospital.

Figures related to cost savings remain elusive. Several sources contacted could not verify what consumers might expect to save if they opt for an integrated care-based Medicare Advantage plan.

Still, the Braven Health team hopes what will differentiate its model will be service delivery that emphasizes the consumer’s needs, says Mr. Doll. “All of us understand that the healthcare delivery system needs to evolve and change, and it needs to evolve and change for the benefits of the communities we serve.”

That could be enough of an improvement to make an integrated care plan more appealing. So could the cross-communication and education that will introduce those who heal, to those who pay, and vice-versa. Aligning services from these different players allows the focus to be on those intended benefits, says Patrick Young, president of Population Health, Hackensack Meridian Health. “Organizations that may have historically been at odds are now working collaboratively to really put the patient first in everything that we do.”

That, says Mr. Doll, includes a key element that he says makes the Braven plan a solid option for consumers. There will be a Practitioner Council, which Mr. Doll says gives physicians a voice in shaping medical policies and more.

With healthcare providers allowed a larger voice in the conversation, Braven Health CEO Luisa Charbonneau said the Braven Health team could create an offering meant to appeal to the wider community needs in New Jersey. The finer details of the Braven Health plan, including those projected cost savings, are still under wraps because of federal regulations, but Ms. Charbonneau said Braven Health is based on a model that has “consistently achieved high customer satisfaction ratings because of that increased coordination of care.”

The 8-county service area is home to more than 60% of the Medicare beneficiaries in the state, said Ms. Charbonneau. That, she says, encompasses a diverse economic demographic that will serve many income levels.

Managing higher levels of care and satisfaction among disparate industries is a feat in itself, but Allen Karp, executive vice president of Healthcare Management and Transformation for Horizon, said each partner has a stake in the quality and affordability of the care. “We all share a dedication to health innovation and patient-centered care.”

For New Jersey residents, whose overall healthcare ranking is in the top 10 of all 50 states, Braven Health is an attractive option for consumers, said Ms. Charbonneau. Information on the plan and its supplemental benefits will be available on the Braven Health website on October 1st.

Lori Widmer writes about insurance and risk management for trade and business magazines.