Shands cuts out insurers, seeks Medicaid enrollees

Shands HealthCare--a health systems in the southeast that includes nine hospitals and more than 80 affiliated physician practices--announced that it will roll out it's own Medicaid offering in an attempt to attract 80,000 possible enrollees in the Jacksonville, FL area. "We have essentially had to develop all the core functions of an insurance company--claims processing, provider relations, benefits plan design, utilization management, disease management," Doug Chaet, vice president of managed care and network development for Shands Healthcare, told The Business Journal of Jacksonville. The program will be called First Coast Advantage. To grab the greatest possible share of the 80,000 potential enrollees, First Coast is waiving all co-pays.

For the first three years of the program, Shands providers will be paid on a fee-for-service basis. They'll also be paid an overhead fee equal to 7.5 percent of the capitation traditional managed care plans receive. The state plans to monitor how much it spends on PSNs such as Shands, and pay based on performance.  If First Coast services cost less per enrollee than the state pays in capitation, then providers get to keep the difference. Meanwhile, if First Coast bills add up to more per month than the state pays managed care firms, First Coast forfeits one-half of the 7.5 percent overhead fee.

- see this The Business Journal of Jacksonville article

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