More on Reimbursement

Illinois co-op boasts of turnout in enrollment tourney

Across the Mississippi River from a bankrupt cousin, a Midwestern cooperative insurer is entering year two with a sizable membership that will test its model of partnering with hospitals.

Land of Lincoln Health, a co-op created by a coalition of hospitals and businesses in greater Chicago, has attracted 20 percent of new enrollees in the second year of Illinois' insurance exchange--more than 10 percent of the statewide individual market.

Some of those members are Illinoisans who didn't buy in the exchange last year, and some may also be consumers who left plans sold by Blue Cross and Blue Shield of Illinois, which sold more than 90 percent of plans for 2014.

"We entered this industry to bring positive disruption to the market," said Jason Montrie, Land of Lincoln Health president. "If the numbers are any indication, that's exactly what we've done, and this Cinderella plans to keep dancing long after this year's tournament is through," said Montrie, a former sales executive with Humana.

The end of the full open enrollment left Land of Lincoln with a total of 50,000 members, and there are still thousands in the state who could qualify to enroll during the current special enrollment period. In 2014, the co-op's policies covered about 4,000 people, and 80 percent of them stayed on this year.

For the 2015 open enrollment, Land of Lincoln Health dropped premiums by 20 to 30 percent and sold the lowest priced silver plan in most parts of Illinois.

Those low premiums came with Land of Lincoln's variety of narrow networks. The strategy is relying on preferred partner plans that offer members low cost-sharing for using hospital systems such as Adventist Midwest Health, Advocate Health, Centegra Health System, Chicago Health System, Illinois Health Partners, Presence Health and Swedish Covenant Hospital, all of whom are a part of the Metropolitan Chicago Healthcare Council that helped launch the co-op.

"Low monthly premiums and solid benefit options are at the core of our current and future members' top priorities when choosing coverage, so we designed our plans for 2015 with that in mind," said Montrie. Created with $160 million federal loans, Land of Lincoln Health is the first new mutual health insurance company to be licensed in Illinois in more than 25 years.

Three for-profit insurers joined Illinois' public exchange market for 2015--IlliniCare (from Centene), UnitedHealthcare of the Midwest, and Time Insurance Company (from Assurant Health). Aetna opted to pull out of exchange plans in the state after 2014, but its Coventry subsidiary remains.

Land of Lincoln Health, with its preferred partner plans and its nonprofit mutual brand, may be able to differentiate itself from those for-profit insurers, which don't have huge footholds in Illinois. But perhaps a larger challenge will be vying with Illinois' original mutual insurer, BCBSIL, which has a two-third's commercial market share--while also avoiding the problems that brought down CoOportunity Health.

(Photo: Jeramey Jannene.)