AET Renews Agreement, Creates PCMH - Analyst Blog

By Zacks | August 31, 2012 AAA

Health insurer Aetna Inc. (AET) announced that it has renewed the agreement with Novant Health Care. According to the new agreement, the latter will continue to provide its healthcare related service to Aetna's members.  A value based agreement has also been created for Novant's certified Patient Centered Medical Homes ("PCMH"). Novant's PCMH-certified practices will receive a reimbursement for providing a coordinated care approach for their attributed members. Extra compensation will be paid if the practices meet certain set targets relating to quality and cost efficiency.

The PCMH is an approach to provide person-centered care in primary care settings. This model organizes care around the relationship between the patient and the personal clinician. In a medical home, a patient can expect attention from the physician on holidays, evenings and weekends without going to the emergency room.

Also, the primary care clinician helps patients select a specialist and informs both the providers and the patients about test or examination results, reviews treatment options, thereby helping them to resolve conflicting advices received from multiple providers.

Thus the PCMH is a model that can help controlling increasing healthcare costs, poor or inconsistent quality and inaccessibility to timely care.

Aetna provides health benefits to approximately 377,000 members in North and South Carolina. These members have the right to use the network, which includes 177 hospitals and 22,030 contracted primary care and specialist physicians.

Aetna has been aggressively working upon all the ways devised by the Health Care Reform to reduce costs and improve health care quality. Last week, Aetna announced that it had joined the Comprehensive Primary Care ("CPC") initiative. This initiative is one of the innovations of a wide-ranging effort by the Obama Administration to promote coordinated care and lower costs for all Americans, using important new tools provided by the Affordable Care Act.

In this regard, Aetna has collaborated with Centers for Medicaid and Medicare Services ("CMS") Innovation Center and 500 primary care physicians throughout the nation. This initiative will help primary care practices deliver higher quality, better coordinated, and more patient-oriented care. It intends to partner with commercial and public health insurers to promote community-wide investments in comprehensive primary care.

Other health insurers such as UnitedHealth Group Inc. (UNH), Humana Inc. (HUM), CIGNA Corp. (CI) are also working upon the ways proposed by the Health Care Law to reduce cost and better quality.

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