Blue Cross NC and Duke Health to create new health insurance company targeting seniors

A building on the Durham corporate campus of Blue Cross and Blue Shield of North Carolina.
A building on the Durham corporate campus of Blue Cross and Blue Shield of North Carolina. Courtesy of Blue Cross NC

Blue Cross and Blue Shield of North Carolina and Duke Health are joining together to form a new health insurance company aimed at seniors, the companies said Tuesday.

The new company, which will be called Experience Health, has filed an application with federal regulators to offer a Medicare Advantage plan in 2020. It will be jointly owned by Blue Cross NC and Duke Health and operate as a not-for-profit, the companies said in a news release.

The company will use Blue Cross NC resources to provide enrollment, billing and claims services for customers, and it will use Duke Health doctors and facilities to provide medical services.

“Consumers want the best possible health care that’s simpler and more focused on their unique needs,” Patrick Conway, president and CEO of Blue Cross NC, said in a statement. “Experience Health will offer exactly that by featuring exceptional Duke Health medical care with efficient Blue Cross NC operations. It’s another example of our desire to collaborate closely with the state’s leading health systems to improve quality, lower costs, and deliver exceptional experience.”

If it’s approved by the Centers for Medicare and Medicaid Services, Experience Health will begin offering Medicare Advantage plans in the following counties on Jan. 1, 2020: Alamance, Durham, Franklin, Granville, Lee, Orange, Person, Vance and Wake. Enrollment would start in fall 2019 and members could seek “in-network” care with Duke Health physicians and facilities, the companies said.

The plan will be headed up by Mark Waggoner, a former vice president of care integration and management at Blue Cross Blue Shield of Rhode Island. The company’s board of directors will be split evenly with members from both Blue Cross NC and Duke.

Kyle Marshall, a spokesman for Blue Cross NC, said Blue Cross still plans to offer its own Medicare Advantage plans.

He added that the plan came together as part of Blue Cross NC’s continuing efforts to work more closely with the state’s health care systems to improve quality and reduce costs. When asked if this could be the first of several new insurance companies formed between Blue Cross NC and other health systems within the state, Marshall said Blue Cross would not have any comment on future plans.

Before today’s announcement, Blue Cross NC and Duke Health had already begun tightening their relationships, with Duke Health being one of five health systems to join Blue Cross NC’s new Blue Premier program, The News & Observer has previously reported.

Blue Premier is a business model that rewards doctors and hospitals for the value provided to patients, rather than the volume of work performed. At the same time, providers are on the hook financially for any cost overruns, along with Blue Cross. The idea is that the model provides an incentive for the medical providers to be more efficient and less wasteful.

Blue Cross NC also announced last month that it would be combining with Cambia, another Blue Cross-afilliated insurer, in a move that will be melding together the two companies’ corporate staffs. That deal is still subject to regulatory approval.

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Zachery Eanes is the Innovate Raleigh reporter for The News & Observer and The Herald-Sun. He covers technology, startups and main street businesses, biotechnology, and education issues related to those areas.