Pennsylvania Adopts Law Supporting Insurance-Less Health Care Offices

Sep 25, 2013, 9:13 AM

Zane Gates, MD, is a Robert Wood Johnson Foundation (RWJF) Community Health Leader and medical director of Altoona Regional Partnering for Health Services in Altoona, Pennsylvania. Gates and Patrick Reilly, president of Impact Health Solutions, founded the Empower3 Center for Health program, which is the model for a new health care law in Pennsylvania.


The Commonwealth of Pennsylvania has recently adopted a law to fund community-based clinics that can demonstrate real impact to the community with regard to increased access, reduced costs, lower emergency room (ER) visits, and improved behavioral health outcomes for the low-income working uninsured.  It is modeled on community-based clinics featuring a unique structure that I created along with Patrick Reilly, an insurance consultant from western New York:— Empower3 Center for Health program.

The model we created features an “insurance-less” office concept that allows patients to come in as frequently as needed without worrying about being billed or having any balances to pay. The program has no co-pays, deductibles or balance billing when the patients use the participating community hospital that partners with the program.  Since there is no billing at the point of service, there is more face time with the medical professionals to spend creating a true relationship that focuses on care and provides dignity to the patients seeking quality medical care. The office is open five days a week to provide access to patients as needed. 

The insurance-less office system also encourages the clinic to see patients frequently since it doesn’t increase overhead. There is no insurance or Medicaid reimbursement administration to sift through that normally diverts the typical physician’s office staff from care and increases the administration overhead burden.  As insurance costs continue to increase, even under the Affordable Care Act reform efforts, more individuals will be seeking to use the ER for service on demand rather than get caught up in a traditional physician system that will be clogged up with more patients than there will be physicians to see them.

The model piloted in Altoona began its full launch in September 2010.  The Empower3 Center for Health program began as a $99 per month program that offered patients full preventive and sickness visits, full lab and diagnostics, and full hospitalization with a vast assortment of common medications provided free or at low cost.  Three years later, the rates have not increased on a population that is 100 percent sick—the worst “adverse selection” group an insurance company can imagine. Contrary to popular opinion from the status quo predictors, the health of the group is improving and the admission rates to the hospital and ER are lower than similar physician groups in the area and are far less than traditional group plan admission rates that, in theory, offer more Cadillac benefits. 

After studying the patients’ admission data, University of Pittsburgh Medical Center (UPMC) Altoona Regional Health System has determined that they clearly have seen significant savings by supporting an outpatient ER system that does not just provide urgent care, but really gives this specific population the full access that they, as chronic patients, need to maintain or improve their medical conditions.  After an early run of claims from new insurance patients (that was predictable) in the first 12 months, claims to the insurance partner have now dropped, and their loss ratios and margins are improving as well.  This is very significant since the common assumption is that insurance carriers cannot make a profit on offering products to the chronically ill, low-income population. 

The Empower3 model data is proving that with all parties working in a partnership to solve the community health needs, the model can work.  The current medical system we have is based on a “combative” model that forces insurance carriers to win while hospitals lose money, patients lose valuable coverage because the employer wins by cutting plan costs and benefits, and they all lose because at the end of the day, access and care that individuals need to improve their health profile is being lost in the system focused on reimbursement processing and billed charges.

The other major component of the Gates-Reilly model is the integration of registered dieticians to engage directly with the patients and medical professionals in the treatment protocol.  With obesity and Type II diabetes increasing, according to the Centers for Disease Control and Prevention, and with most studies pointing to a lack of healthy behavior in low-income populations, this plan feature was imperative as an equal part of the program. Data already being studied within the group is showing that patients engaged in this part of the program are already seeing better blood profiles, weight loss and improved self-esteem. 

Overall, the new Pennsylvania funding is looking to jumpstart a new direction for health care by refocusing on patient care first, access, lower hospital costs, and patients’ quality of life.

This commentary originally appeared on the RWJF Human Capital Blog. The views and opinions expressed here are those of the authors.