Blue Shield, Hill, Dignity Health launch ACO

Blue Shield of California, Hill Physicians Medical Group and Dignity Health are starting a three-year Affordable Care Organization effort in San Joaquin County to provide “integrated, cost-efficient” health care to 14,600 Blue Shield HMO enrollees in the region.

About 10,300 of those enrollees are covered through the California Public Employees’ Retirement System.

The goal is to hold costs steady the first year, with “low, single-digit increases” in subsequent years. ACOs are seen as a key to success of national health reform, but the jury is still out on whether they’ll pull their weight in terms of controlling costs while maintaining or improving quality. Some see dangers of further consolidation and added price-setting power by the large health care organizations — like these three partners — that increasingly dominate health care, especially in the Golden State.

San Francisco-based Blue Shield, led by CEO Paul Markovich, San Ramon-based Hill and San Francisco nonprofit hospital chain Dignity Health launched earlier ACOs in the Sacramento area four years ago, and San Francisco three years ago.

At various points, the partners have said they saved tens of millions of dollars in earlier ACO efforts. Dan Robinson, a Hill Physicians spokesman, said the latest total is $105 million in savings through year-end 2013.

Dignity’s St. Joseph’s Medical Center in Stockton also is participating in the San Joaquin ACO.

The San Joaquin effort “will continue at a minimum through 2016,” officials of the three partnering organizations said.

All told, Blue Shield says it has 14 such collaborations under way, covering 230,000 enrollees statewide. That includes 43,400 in the greater Sacramento area, 23,000 in San Francisco, 16,000 in Contra Costa County, 8,000 in Santa Cruz County, and tens of thousands of others in Los Angeles, Orange County, San Bernardino County and elsewhere in the state.

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