Covered California is the California exchange entity. It is very different than any other exchange in the country as it is a very active buyer and manager of the choices it allows to be sold on the individual market. This has allowed it to be the leading Silver Gapper and Silver Loader in the country as it does not allow for a single Medicaid like insurer to take both the least expensive Silver and the benchmark Silver position.
It is also allowing for an aggressive attempt to reform networks by improving quality. KQED reports:
In the next three-year contract that Covered California strikes with insurance companies, there will be a quality-focused stipulation: any hospital that doesn’t meet certain targets for safety and quality can be excluded from the health plans sold through the marketplace….
Covered California is joined by Medi-Cal, the state health program for low-income residents, CalPERS, the retirement program for state employees, and the Pacific Business Group on Health, which represents self-insured employers. Together, these groups pay for the health care of 16 million Californians, or 40 percent of the state, which gives them substantial leverage with hospitals.
But only Covered California is telling hospitals that if don’t play by the rules, they’ll be benched.
There is enough market power on the payer side to make a lot of the providers listen. The goals are only somewhat ambitious, but there is serious money attached to them so most hospitals will at least file paperwork that shows the desired levels of performance.
This is an interesting attempt to use market power of a group of coordinated buyers to get better value out of the provider world.