After unveiling a delivery system in March that puts at-risk specialists completely in charge of certain conditions, Oxford Health Plans has been moving quickly to contract with hundreds of medical specialists and organize them into specialty "teams."
To date, more than 600 physicians have signed up for the program.
It's one way Norwalk, Conn.-based Oxford is trying to differentiate itself in the metropolitan New York healthcare market, where most specialists in managed care still are paid under the old discounted fee-for-service system.
There, specialists and patients have been chafing under many HMOs' requirement that patients obtain referrals from primary-care doctors before visiting specialists.
Oxford Specialty Management, a newly formed Oxford subsidiary, is running the new program.
The subsidiary forms teams of physicians by specialty. The teams are paid a predetermined case rate, and are responsible for coordinating and providing all care for an illness or condition, including laboratory tests and hospitalization. The teams, which use agreed-upon treatment protocols, are reimbursed over time, as specific treatment steps are taken.
Oxford provides insurance for catastrophic cases so providers won't go under, said Todd Farha, chief executive officer of Oxford Specialty Management.
Oxford has assembled teams for cases including cataract, behavioral health, prostate cancer, breast cancer, coronary artery bypass graft, hip replacement and pregnancy.
The health plan is spending "millions" of dollars to develop information for patients on their illnesses and conditions, as well as to build performance profiles of specialty physicians so that enrollees can choose among the teams, Farha said.
Oxford enrollees are referred to the specialty teams by their primary-care physicians, but the specialty-team program is voluntary. Enrollees still can choose to receive care from individual specialists.
About 320 physicians were signed up for Oxford's specialty teams in May. "We've much more than doubled the contracts we had as of May," Farha said.
Specialty teams are working in contracts Oxford has signed with leading institutions, such as Beth Israel Medical Center, Lenox Hill Hospital, Montefiore Medical Center, New York Eye & Ear Infirmary and the Rothman Institute .
"There's been a remarkable level of interest," Farha said. "Specialists are excited because we aren't asking them to cut their fees."
Oxford has been realizing savings of about 15% to 20% on the specialty contracts through efficiencies, he said.
Coordination of care can save money by ensuring something as simple as not ordering the same test twice, said Andrew Litt, M.D., vice chairman of radiology at New York University Medical Center and a founder of Comprehensive BreastHealth of New York, a 15-physician specialty team providing total care for women undergoing breast cancer diagnosis and treatment.
"We think we can get rid of the waste," Litt said.
Physicians created CBNY to get clinicians to work together to design protocols for care in advance and then to coordinate care. Besides physicians, social workers and care coordinators help a woman through breast cancer diagnosis and treatment, Litt said. It's hard for the individual physician to pull that together, he said.
"We would do this without Oxford," Litt said, but Oxford's ideas happened to coincide with CBNY's. CBNY has approached other plans with the idea. All were "positive," but some aren't ready yet, Litt said.
"Assuming Oxford is careful about it," Litt said he supports the gathering of clinical information so patients can compare teams.
Irwin R. Merkatz, M.D., professor and chairman of the department of obstetrics and gynecology and women's health at Montefiore, believes Oxford's is the first case-rate contract "done around the totality of the obstetrical event."
About 40 specialists work on Montefiore's specialty team, which cares for both normal and complicated pregnancies. In the future, Montefiore might assemble a team to treat infertility. The hospital also might add a component to the pregnancy team that would cover a patient who develops cancer of the uterus, Merkatz said.
Like other teams, Montefiore's is looking forward to offering its services to other payers. "What we want to do is use this as a test model to get the expertise to manage risk and know what the spectrum of experience will be like. Then we will be in a much stronger position to negotiate with another insurer," Merkatz said.
Oxford founder Steve Wiggins stepped aside as president of the company earlier this month (he remains chairman) in order to devote his energies to the specialty subsidiary. Wiggins is also chairman of the specialty subsidiary.
"This originated as Steve's idea," Farha said. "It was his vision. He really views this as the future of specialty care."
Oxford eventually plans to offer a network of specialty teams as a separate point-of-service product, Farha said. The company also intends to market its specialty-team idea to self-insured employers and other payers outside its service area that aren't as adept at medical management, he said. Wiggins is driving this move to link up with other payers, Farha said.
As for other HMOs copying Oxford's specialty-team idea, "we have a significant jump" on the competition, Farha said.
Oxford already has spent a significant amount on patient education and data collection for clinical guidance and physician profiling, he said.