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Blue Cross and Blue Shield of Texas and Memorial Hermann Health System Announce Alliance to Improve Quality of Care and Reduce Costs

Sep. 05, 2013

New ACO Arrangement realigns focus to value of service with emphasis on improving health outcomes

Houston, TX — Blue Cross and Blue Shield of Texas (BCBSTX) and Memorial Hermann Accountable Care Organization (MHACO)  announced a new strategic alliance today that will deliver improved, sustainable patient care while better managing health care costs, beginning mid-2014. An accountable care organization (ACO) is a collection of providers that have agreed to coordinate care across a continuum of heath care settings to improve the coordination and quality of care. The ACO model improves the patient's health and experience while reducing costs through avoiding unnecessary hospital admissions, readmissions, emergency room (ER) visits and duplication of services. MHACO's 1,900 primary care and specialty physicians focus on providing quality services that have the potential to improve their patients' health and reduce the cost of care.

"By establishing this arrangement with MHACO, BCBSTX hopes to provide the Houston community with improved quality of care and lower costs; providing better value and improved outcomes for our members," said Dr. Robert Morrow, Senior Medical Officer for BCBSTX. "This collaboration is an extension of BCBSTX's commitment to enabling innovative, value-based care delivery models, which are designed to reward physicians for managing costs and quality of total patient care while moving from the traditional fee-for-service approach to a fee-for-value payment model."

"Our relationship with Blue Cross Blue Shield of Texas around accountable care activities is consistent with Memorial Hermann's commitment to quality outcomes and cost management," said Chris Lloyd, CEO of MHACO. "The efforts we will undertake together will continue to advance the health of the populations we serve."

This new model of health care delivery is designed to improve outcomes in three key categories: quality of care, patient experience and satisfaction, and cost efficiency. It will reach those goals by pursuing the following strategies:

  • Early identification of disease and illness through effective management and coordination of patient care;
  • Use of advanced technology and support services to make more informed decisions and facilitate the patient and provider relationship and transitions in care;
  • Implementing an alternative or non-fee-for-service payment arrangement; and
  • Lowering cost trends by coordination among payers and providers, without limiting medically necessary services in order to enable the delivery of more affordable health care products.

"This is a paradigm shift in paying for medical services. The arrangement begins to move reimbursement away from fee for service to fee for value," said Shara McClure, BCBSTX Vice President for Network Management. "In addition, the arrangement enables MHACO to harness clinical data to help drive medical care decision-making, enhance patient safety and improve quality of care — all supporting the goals of better health and improved outcomes for BCBSTX members."

Dr. Keith Fernandez, Chief Medical Officer of MHACO, added, "Our combined population management efforts will allow us to more efficiently deliver health care in the greater Houston area and will continue to serve as a model for the rest of the country around health reform principles."

The new alliance enhances a previous agreement that allows more than 1.1 million BCBSTX members access to in-network health care services at Memorial Hermann hospitals and outpatient facilities in the greater Houston area. MHACO will serve populations in Harris, Fort Bend and other surrounding counties.

View 2013 News Releases