The Allegheny County Schools Health Insurance Consortium was recognized last year by the Pittsburgh Business Group on Health for “Excellence in Driving Innovation in Employee Health,” and by the Pittsburgh Business Times as a Health Care Hero.

The Pittsburgh Business Group on Health has been recognizing companies in the Pittsburgh region for innovation and excellence in employee healthcare for more than 10 years, according to CEO Jessica Brooks. The award for Excellence in Driving Innovations for Employee Health and Wellness is presented to the company that demonstrates positive outcomes and improves the health of a population, she says. Past winners include Westinghouse and HJ Heinz.

Brooks also nominated ACSHIC for the 2016 Health Care Heroes Award, which honors individuals, companies and organizations in Western Pennsylvania for their contributions to improving health care in the region.

Brooks says ACSHIC, which represents about 43,000 employees, was recognized for its efforts to develop a narrow, high-quality network. To make this decision, trustees used tools and resources through the Business Group, of which they are a member, to analyze the cost, quality and value of providers.

The effort resulted in the consortium working with its health insurance carrier to design a tiered benefit plan design that offered a narrow, high quality network, which saved taxpayers more than $10 million in claims throughout the first half of 2015 alone. This enabled ACSHIC to eliminate deductibles and co-pays for its members, bucking the trend toward high-deductible plans while reducing costs. Through October of last year, savings had been close to $21 million, Brooks said.

As a result, the community, teachers, children, school boards, unions and taxpayers received higher quality healthcare at a lower cost, in addition to financially healthier schools and cost containment for taxpayers.

Jan Klein, an ACSHIC trustee, says consortium members read studies and listened to speakers on how health insurance plans can either positively or negatively impact a member’s health. Once touted as the answer to rising costs in healthcare, high-deductible plans have been criticized as unsuccessful in limiting the use and cost of services. They’ve instead deterred member use of services until the member is very sick and in need of more extensive and costly services than would have been necessary. 

“This phenomenon is due to a member’s lack of understanding of high-deductible plans, reluctance to spend from the deductible even if it is funded by the employer and a lack of good cost tools so members can become informed purchasers of services,” Klein says.

This was not an effective path to control costs, so trustees researched networks based on lower-cost providers, Klein says. The thought was that if a hospital costs less, its total claims would go down. However, ACSHIC trustees insisted reducing costs alone was not enough. 

“Lower-cost providers would only be acceptable if there was independent data to show that the quality was the same or better than the high cost providers,” Klein says. “We gathered data from Comparion and entertained a study by Imagine Health to see if a lower-cost network of providers with high-quality ratings were possible in Pittsburgh.” 

Trustees learned the Community Blue Flex plan offered by Highmark Insurance increased its total quality ratings for providers, and kept costs low because the higher-cost providers would be limited to the members through the insurance plan.  

“Savings by developing a narrow quality-based network is obtained by assuring fewer hospital-acquired infections, fewer readmissions, better first-time outcomes and the greater likelihood of getting the correct treatment in the first place,” Klein says.  “This decreased our actual claims in the year members transitioned to the new network in advance of benefit changes and led to $20 million in savings over a two-year period.” 

In addition to higher quality services for members, Klein says ACSHIC removed deductibles in the quality network tier and eliminated and reduced co-pays for the doctors in that tier.

“Our premium increases have been in the low single digits throughout this process,” she says.  “And our membership in the consortium is growing as neighboring school districts look to become part of our success.”

Klein says the real prize is knowing employees can afford to see a medical professional as soon as they fall ill, and preventing serious complications by getting the proper treatment.