Greensboro - One Stop Shop

Transcription

2013
MARKET
OVERVIEW
Greensboro
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Update: July 2013
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GREENSBORO MARKET OVERVIEW
Greensboro
Counties Covered:
Davie, Forsyth, Guilford, Randolph, Rockingham,
Stokes, and Yadkin
Key Cities Covered:
Greensboro, High Point, and Winston-Salem
Population:
1,212,991
Contents:
3 Updates: Key Market Events
4 Executive Summary
5 Greensboro Market
9 Health Systems & Hospitals
24Physicians
32 Health Plans
40Medicaid/Medicare/Uninsured
43Pharmacy
45Legislation
46Employers
49 Demographics & Statistics
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Market Analyst
Sarah Wilson
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Greensboro Analyst
Principal Director, Managed Markets Analysis
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CORPORATE OFFICE
Sarah Wilson
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Except where otherwise indicated, information in this product is from analysis of HealthLeaders-InterStudy data, interviews with local experts, news sites, and industry reports.
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2013 Market Overview
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COPYRIGHT © 2013 | HE ALTHLE ADERS-INTERSTUDY
2
KEY MARKET EVENTS
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Updates: Key Market Events
July 2013 - Carriers, providers forming partnerships for ACOs
Since the beginning of 2013, Greensboro has seen an influx of accountable care organizations. Cigna selected second-largest health system Novant for its largest collaborative accountable care initiative nationwide.
Largest carrier Blue Cross and Blue Shield of North Carolina and Cornerstone Health, an independent
physician group, have also formed an ACO. BCBS of North Carolina’s agreement with Cornerstone gives
the physician group value-based agreements with its contracted carriers. For more information, see the
Health Systems & Hospitals, Physicians, and Health Plans sections of this report.
July 2013 - Cone Health completes merger with Alamance Regional
After several intense reviews by the Federal Trade Commission to ensure the Triad would remain competitive, Cone Health was given clearance to complete its merger of Alamance Regional Medical Center.
The two health systems will focus on combining their processes and policies to form one unified system.
For more information, see Cone Health’s profile in the Health Systems & Hospitals section of this report.
July 2013 - Novant Health implements systemwide rebranding
Update
Novant Health has implemented a rebranding strategy, renaming all of its healthcare facilities to include
Novant Health in the name; executives wanted to unify the system and promote Novant’s national reputation. For more information, see Novant’s profile in the Health Systems & Hospitals section of this report.
July 2013 - Gov. Pat McCrory unveils Medicaid reform plan
Following in the footsteps of Wisconsin Gov. Scott Walker, Gov. Pat McCrory and the state’s Department
of Health and Human Services have proposed to reform Medicaid, rather than expand it. The plan, dubbed
Partnership for a Healthy North Carolina, will focus on reducing administrative duplication and breaking
apart the silos that exist among physical, mental, and substance-abuse care. The goal of the overhaul is to
save the state money and streamline the program for providers and beneficiaries. For more information,
see the Medicaid section of this report.
January 2013 - HealthLeaders-InterStudy publishes annual Market Overview for
Greensboro
The annual report provides data and analysis of several sectors of the Greensboro healthcare market,
including hospitals and health systems, physicians, health plans, Medicaid, Medicare, the uninsured,
pharmacy, legislation, and employers.
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Executive Summary
Market Outlook
» » Known as the Piedmont Triad for its inclusion of Greensboro, High Point, and Winston-Salem, the
Greensboro market is moderately consolidated, with health systems closely aligned with physician organizations, and becoming more so. Many health systems have pursued consolidation across market lines,
including the alliance of Novant Health and Georgia-based Memorial Health, and High Point Regional
Health System’s joining with UNC Health Care in Chapel Hill. The merger of market leader Cone Health
with Alamance Regional Medical Center (in Burlington, outside the Greensboro market) underwent
intense scrutiny by the Federal Trade Commission, but was finalized in April 2013.
As a result of the Affordable Care Act, health systems and physician groups are restructuring and reorganizing, focusing in particular on changes to payment and organizational structure to better fit the emerging paradigm. Cone Health (part of the larger Triad HealthCare Network) and the largest independent
physician organization in the market, Cornerstone Health Care, were selected to participate in the Medicare Shared Savings program as accountable care organizations. A real power-hitter, Cornerstone is also
involved with insurers for three commercial ACOs and a narrow-network product. Cornerstone also has
agreements with all contracted health plans for value-based initiatives. Highlights:
»» W
e expect consolidations to continue in Greensboro as federal healthcare reform continues to support
these efforts. As area health systems continue to pursue mergers, they will face stringent review from
the Federal Trade Commission. Local health systems will also look into forming strategic partnership
as an alternative method of consolidation; it will be important for health systems to consider both
options before making a final decision.
»» W
e expect local health systems and physician groups to continue developing ACOs, patient-centered
medical homes, and other quality programs with the goals of improving health in the region and
lowering the cost of care. Continued partnerships and collaborations will be key to effectively implementing these programs, expanding their reach, and monitoring their results.
»» N
orth Carolina will not expand Medicaid eligibility to 133 percent of the federal poverty level as outlined by the Affordable Care Act. Gov. Pat McCrory and the Republican-controlled General Assembly
opposed the optional expansion, which would have added an estimated 500,000 beneficiaries to the
program. Uninsured North Carolinians will have to purchase insurance through the federally run
insurance exchange and may have a difficult time affording their coverage, including prescription
drugs.
»» H
ealth plans will see increased enrollment in commercial plans as the unemployment rate further
declines. Commercial enrollment continues to be dominated by PPO plan designs and self-insured
health plans, while consumer-driven health plans continue to draw increased interest. Costs will
continue to play a big role in health plan selection, with insurers Blue Cross and Blue Shield of North
Carolina, UnitedHealth Group, and Coventry Health Care of the Carolinas offering lower-cost plan
designs that feature a limited formulary and provider network.
»» A
s the local economy continues to recover, more residents will be able to purchase insurance, resulting
in better access to care and prescription drugs. However, local healthcare providers will still face lower
patient volumes, as residents continue to save instead of spend on healthcare.
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Greensboro Market
Analysis For Greensboro Healthcare Market
Table 3-1:
Threats:
Pharma
Opportunities:
Pharma
» Though medication
adherence is lower in North
Carolina than the national
average, Greensboro healthcare organizations are
implementing care-transition
and medication management
programs, which will help to
improve adherence rates.
» With new narrow provider
networks emerging in the
Greensboro market, drug
marketers will want to target
their message to preferred
providers, who will see
increased patient volumes.
» As area healthcare organizations align with one another to
form ACOs, there will be an
increased focus on generic
drugs, with branded-drug
prescribing reserved for
products with the highest
efficacy. Pharma may
experience a more difficult
time getting its drugs on
approved formularies.
» With the continued
economic strain in Greensboro,
some residents have trouble
affording health insurance and
basic care, and may have
difficulty purchasing prescription drugs.
Opportunities:
Managed Care
» As more healthcare
providers in Greensboro
implement ACOs and medical
homes, they may be willing to
work with managed care
organizations in an effort to
reduce costs.
» The Greensboro region, like
the rest of North Carolina, falls
behind the curve on
implementing employee
wellness programs and on-site
clinics. Triad employers are
making an effort to implement
health-promotion programs,
and can benefit from carriers’
assistance.
Sources: HealthLeaders-InterStudy, 2013
Threats:
Managed Care
» Uninsured rates remain
above the national average as
Greensboro’s economy
recovers from the recession.
As healthcare costs continue
to rise, local employers may
implement self-funded
insurance plans and possibly
limited or closed formularies.
» Provider consolidation may
limit the power of health plans
to negotiate rates. In addition
to operating a Medicare ACO,
the clinically integrated Triad
HealthCare Network is able to
negotiate with all healthcare
players, including health plans.
© HealthLeaders-InterStudy
Market Indicators
Table 3-2:
Market Stage: Consolidated*
Market
» Moderate consolidation/integration of physician groups
» High consolidation/integration of health systems/hospitals
» Moderate use of disease management, utilization management
» Health plans have implemented a number of cost/quality controls for physicians/hospitals
» PPO benefit option prevails
*For definitions of other market stages, see the Market Overview Product Manual.
Source: HealthLeaders-InterStudy, 2013.
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Table 3-4:
Situation Analysis by Segment
O
O
O
Health Systems and Hospitals
Neutral for health systems and hospitals. Look for steady patient volumes and stable earnings.
Physicians
Neutral for physicians. Look for earnings to remain stable.
Health Plans
Neutral for health plans. Look for stable health plan enrollments and/or profitability.
–
Pharmacy
Negative for pharmaceutical sales. Expect declining PMPM costs for health plans and/or overall decreases
in the use of branded drugs.
+
Employers
Positive for employers. Expect healthcare premiums to increase at a slower rate or decline, with increased
efforts at healthcare cost containment.
Table 3-5:
Market Consolidation
Hospital segment
Physician
segment
Health plan
segment
»
High: 2 or 3 organizations control about 80% of the market.
»
»
Moderate: 4 or 5 organizations control about 70% of the market.
Low: More than 5 organizations control about 70% of the market.
Leading Organizations & Health Plans
Table 3-7:
Health Systems/Hospitals
Name
Total # of Hospitals
Total # of Beds
Market Share*
Cone Health**
4
937
32%
Novant Health
3
941
27%
Wake Forest Baptist Health
3
865
22%
*Based on inpatient discharges.
**Bed count and market share include Behavioral Health Center.
Sources: HealthLeaders-InterStudy, 2013; based on data from Billian’s HealthDATA, 2012.
Table 3-8:
Physician Organizations
Name
Total # of Physicians
859
Novant Medical Group
423
Cone Health Medical Group
400
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Table 3-9:
Total Enrollment*
Plan
Enrollment
Market Share
BCBS of North Carolina
198,463
36%
UnitedHealth Group
158,037
29%
61,830
11%
Enrollment
Market Share
UnitedHealth Group
43,434
48%
32,353
35%
5,452
6%
Enrollment
Market Share
165,630
59%
Aetna**
36,882
13%
WellPoint***
27,181
10%
Enrollment
Market Share
100,144
61%
51,374
31%
5,861
4%
Enrollment
Market Share
0
0%
Cigna
*All HMO, PPO, POS, indemnity, Medicaid, and Medicare products.
Source: HealthLeaders-InterStudy, as of July 1, 2012.
Table 3-10:
HMOs*
Plan
WellPoint**
*All HMO products, including Medicaid and Medicare.
**Projected.
Table 3-11:
PPOs*
Plan
*Includes fully and self-insured commercial and Medicare PPO.
**Includes Coventry, which Aetna acquired in May 2013.
***Projected.
Table 3-12:
POS*
Plan
UnitedHealth Group
Cigna
Aetna**
*Includes fully and self-insured point-of-service plans.
**Includes Coventry, which Aetna acquired in May 2013.
Table 3-13:
MCO-Managed Medicaid
Plan
None
Source: HealthLeaders-InterStudy, as of July 1, 2012. Includes Title 19, CHIP, and other managed Medicaid lives.
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Table 3-14:
MCO-Managed Medicare
Plan
Enrollment
Market Share
UnitedHealth Group
43,574
49%
32,763
37%
8,252
9%
Humana
Source: HealthLeaders-InterStudy, as of July 1, 2012. Includes HMO, PPO, PFFS, and other managed Medicare lives.
Table 3-15:
Major Employers
Name
# of Employees
University of North Carolina System
12,294
City of Greensboro
11,324
The Moses H. Cone Memorial Hospital
9,439
Guilford County School System
9,051
Wake Forest University
8,757
State government
7,824
Winston-Salem/Forsyth County Schools
7,318
Guilford County
7,227
Sources: HealthLeaders-InterStudy, 2013; January 2012 Employer Vantage.
Table 3-16:
Pharmacy Chains
Name
Burton’s Pharmacy, Costco, CVS/pharmacy, Harris Teeter, Kerr Drug, Moses Cone Pharmacy, Rite Aid, Sam’s Club, Target, Wal-Mart
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Health Systems & Hospitals
Table: Situation Analysis
O
THIS SECTOR IS: NEUTRAL
Sector Outlook
Greensboro health systems are heavily integrated with local physician groups. Throughout 2012,
Triad health systems, including Cone Health and Novant Health, focused on better preparing for the
upcoming changes associated with federal healthcare reform, creating accountable care organizations, patient-centered medical homes, and disease management programs, and forming alliances
to improve quality while gaining efficiencies of scale. Cone Health’s Triad HealthCare Network was
selected as one of two ACOs in the market (the other was physician organization Cornerstone Health
Care) to participate in the Centers for Medicare & Medicaid Services’ Shared Savings program. Local
health systems are also merging with healthcare entities outside the Greensboro market and, in some
cases, across state borders. We expect this activity will allow for increased quality, although it may have
the side effect of making reimbursement negotiations more difficult for health plans.
Highlights:
» » Market composition:
The moderately consolidated Greensboro health-system market is dominated by nonprofits Cone
Health, Novant Health, and Wake Forest Baptist Health, with the remainder held by smaller health
systems and hospitals, including High Point Regional Health System and Randolph Hospital. Cone
Health primarily serves the Greensboro portion of the Triad, while Novant Health and Wake Forest
Baptist vie for patients in Winston-Salem. Wake Forest Baptist Health is the only academic health
system in the market, although Chapel Hill’s UNC Health Care is expected to enter the market in 2013
through its merger with fourth-largest health system High Point Regional Health System.
Major systems Cone Health, Novant Health, and Wake Forest Baptist each have their own physician
subsidiary; Cone Health has also formed affiliations with other local physician organizations in the
market as part of its Triad HealthCare Network.
Based in Winston-Salem, the Wake Forest Comprehensive Cancer Center is a National Cancer
Institute-designated cancer center. North Carolina has two other designated comprehensive cancer
centers: Duke Cancer Institute in Durham and UNC Lineberger Comprehensive Cancer Center in
Chapel Hill (National Cancer Institute website, accessed Nov. 21, 2012).
» » Hospital makeup:
The seven-county Greensboro market has 15 acute-care hospitals, with an estimated 159,107 inpatient
discharges annually and 3,532 total acute-care beds. The average daily occupancy rate is 59 percent,
and the average length of stay is 5.3 days. Medicare and Medicaid account for an average 29 percent
and 20 percent, respectively, of the area’s acute-care discharges (based on the most recent federal
Medicare hospital statistics from Billian’s HealthDATA). Data for inpatient discharges, average occupancy, ALOS, and Medicare/Medicaid patient volume exclude Kernersville Medical Center, which
opened in March 2011.
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» » Financial performance:
The largest health systems and hospitals in the Greensboro market were turning profits as of the end of
2011, but have faced increasing financial uncertainty with the Supreme Court’s validation of national
healthcare reform and the market’s higher-than-average uninsured rate. While the economic status in
the Greensboro market is slowly improving, local health systems are still feeling the effects of lowered
healthcare spending coupled with declining reimbursement rates and federal healthcare reform mandates. Novant Health and Wake Forest Baptist both announced layoffs in 2012 in an effort to control
costs while still providing top-quality care to patients.
» » Value-based purchasing:
The Centers for Medicare & Medicaid Services began withholding 1 percent of regular hospital reimbursement based on hospital performance, including the rate of hospital readmissions and patient
experience, in October 2012. The highest-scoring hospitals will get all of their Medicare deductions
back, and the lowest-scoring hospitals will get nothing back. The level of deduction will increase over
a five-year period, topping out at 2 percent in late 2016. Greensboro hospitals ranked 104 out of 295
hospital referral regions in patient satisfaction in 2010; the average hospital readmission penalty in the
referral region is 0.64 percent (Kaiser Health News analysis of CMS data).
Local health systems and hospitals faced varying percentages of cuts when the first rounds of Medicare reimbursement rate cuts were announced by CMS in November 2012. Novant Health’s Forsyth
Hospital was not penalized with any reimbursement cuts, while Randolph hospital faced one of the
largest cuts possible (0.93 percent) in reimbursement rates.
» » Certificate of need:
Local health systems and hospitals continue to expand their facilities, despite Greensboro’s stillstruggling economy, in an effort to improve outdated infrastructures and better serve the needs of
the population. While most health systems have to wait until the open, monthly review periods of the
certificate-of-need board to apply for expansion approval, North Carolina’s academic medical centers, such as Wake Forest Baptist, are able to circumvent the review period and face fewer restrictions
(North Carolina Department of Health and Human Services, accessed Dec. 10, 2012). Prior requests
to ratify the CON laws have not resulted in any changes, but new calls to edit the review process are
a result of the recent decision denial of Novant’s appeal to block Wake Forest Baptist’s ambulatorysurgery center by the North Carolina Court of Appeals.
» » Mergers:
In the past year, Novant Health and High Point Regional each pursued consolidation opportunities,
both within and outside the state’s borders. High Point Regional elected to merge into UNC Health
Care, based in Chapel Hill, and the deal was completed April 1, 2013. Novant Health partnered with
Savannah, Ga.-based Memorial Health in mid-2012 and continues to examine other partnership
opportunities outside the state. Cone Health, meanwhile, merged with Alamance Regional Medical
Center (located in nearby Burlington) in May 2013. Its pursuit of Alamance began in 2011, and the deal
was delayed due to stringent antitrust review from the Federal Trade Commission.
» » Accountable care organizations:
Two ACOs in the Greensboro market were selected by CMS in July 2012: Cornerstone Health Care
(discussed in the Physicians section of this report) and Triad HealthCare Network. Greensborobased Triad HealthCare Network’s provider group is composed of Cone Health and individual ACO
practices. THN ACO had 759 physicians treating Medicare beneficiaries in North Carolina when the
program was selected (CMS website, accessed Nov. 20, 2012). THN has since grown to approximately
800 physician participants (Triad HealthCare website, accessed Nov. 20, 2012). In March 2013, Novant Health was selected to participate in Cigna’s collaborative accountable care initiative, the health
system’s first ACO.
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» » Medical homes:
Local health systems, in conjunction with their physician organizations, are offering patient-centered
medical homes recognized by the National Committee for Quality Assurance. Given the generally
poor health status of North Carolina residents and low medication adherence, health systems are
exploring PCMHs to improve the overall health of their patients while reducing hospitalizations.
Novant Health is also participating in a medical neighborhood demonstration project with several
other health systems nationwide.
» » Information technology initiatives:
North Carolina established the NC Health Information Exchange in April 2012 with five active programs focusing on sharing patient data among state providers to better coordinate care. Among those,
the Medication Management program partners NC HIE with Community Care of North Carolina
to build on CCNC’s existing medication management infrastructure. North Carolina Program to
Advance Technology for Health, or NC PATH, is a collaboration of NC HIE, Allscripts, and Blue
Cross Blue Shield of North Carolina to connect providers across the state (NC HIE website, accessed
Dec. 7, 2012).
» » Telemedicine:
Cone Health, Novant Health, and Wake Forest Baptist Health each employ telemedicine programs to
treat ICU patients, neurological conditions, or behavioral health issues. Academic-based Wake Forest
Health was the first health system in the state to implement a telestroke network and continued its
innovation with the first teleconcussion network in the Southeast.
» » Transitional care initiative:
In August 2012, the Northwest Triad Care Transitions Community Program was selected to be part
of the third group of the Community-based Care Transitions Program created by the Affordable Care
Act. This program tests models for improving care transitions from the hospital to other settings
and reducing readmissions for high-risk Medicare beneficiaries; the program assists rural and urban
residents of North Carolina. Northwest Community Care Network will lead the organization, and it
will partner with three other community-based organizations. The following seven hospitals in Davie,
Forsyth, and Surry counties participate: Forsyth Medical Center, Hugh Chatham Memorial Hospital,
Lexington Medical Center, Medical Park Hospital, Northern Hospital of Surry County, Thomasville
Medical Center, and Wake Forest Baptist Health (CMS).
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Cone Health
Table 4-1
Local
hospitals:
Local hospital
beds:
Physicians
employed:
Physicians
affiliated:
PBM:
GPO:
4
937*
400
1,031
N/A
MedAssets Supply Chain Systems, Novation, and VHA
Four acute-care hospitals:
» Moses H. Cone Memorial Hospital
» Annie Penn Hospital
» Wesley Long Community Hospital
» The Women’s Hospital of Greensboro
Major outpatient centers:
» Cone Health Outpatient Rehabilitation
Physician groups:
» Cone Health Medical Group, 400 physicians
Other details:
» Cone Health Cancer Center at Wesley Long Hospital
» Oncology services through Cone Health Cancer Center at Annie Penn Hospital, Randolph Hospital in Asheboro, Morehead Hospital in Eden, and
MedCenter High Point
» Triad HealthCare Network, a clinical integration model with approximately 800 physicians in the Greensboro market; also a Medicare Shared Savings ACO
» Management agreement with Carolinas HealthCare System
» MedCenter High Point, freestanding ER
» MedCenter Kernersville, urgent-care facility
» Cone Health Urgent Care Center
» Affiliated with LeBauer HealthCare, 73 multispecialty physicians
» Cofounded Greensboro Imaging with Greensboro Radiology, 48 physicians
» Staffs two HealthServe Community Health clinics
» Staffs The Clinic at Wal-Mart in Burlington
*Number includes Behavioral Health Center.
Sources: HealthLeaders-InterStudy; based on data from Billian’s HealthDATA.
Description
Cone Health provides a continuum of care in Alamance, Guilford, Rockingham, and Randolph counties,
and provides care in the city of Kernersville. It is among the Greensboro market’s largest private employers
and is a teaching facility for internal medicine, family practice, obstetrics and gynecology, and pediatrics.
The system changed its name from Moses Cone Health System to Cone Health in 2011.
Cone Health accounts for 32 percent of inpatient discharges and 27 percent of total acute-care beds in the
local market. The average occupancy rate is 67 percent, and the average length of stay is 5.0 days. Medicare
and Medicaid account for an average 27 percent and 21 percent, respectively, of acute-care discharges
(based on the most recent federal Medicare hospital statistics from Billian’s HealthDATA).
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The system’s flagship facility is the Moses H. Cone Memorial Hospital. Located on a 63-acre campus, it is
the largest medical center in its service area, offering comprehensive services in a wide range of medical
and surgical areas. The hospital includes the Moses Cone Heart and Vascular Center, a pediatric emergency department, a Level II trauma center, and the Moses Cone Urgent Care Center. Outpatient healthcare
services include the Cone Health Center for Pain and Rehabilitative Medicine, a rehabilitation center, the
Cone Health Nutrition and Diabetes Management Center, the Cone Health Developmental and Psychological Center, and the Cone Health Wound Care and Hyperbaric Center.
News and Analysis
Cone Health was finally able to complete its merger with Burlington, N.C.-based Alamance Regional
Medical Center in May 2013, after an intense FTC antitrust review. Moving forward, the two health systems will create standard processes and policies, including those of HR and EMR use. Alamance may also
be adding services previously unavailable in Burlington (The Business Journal of the Greater Triad Area).
Throughout 2012, Cone Health aligned itself with North Carolina–based health systems to maintain its
status as the largest health system in the Greensboro market and to enter new markets. Cone Health’s
management agreement with Charlotte’s Carolinas HealthCare System, finalized in June 2012, gave the
health systems greater power when negotiating and purchasing for the 10-year term.
Expansion plans: As Cone Health continues to expand and renovate its facilities in Greensboro, the health
system plans to update vacant spaces in its hospitals. In 2012, Cone Health completed or began the following projects:
» » I n August 2012, Cone Health opened the newly expanded emergency department at Wesley Long
Hospital. The $18 million expansion includes 25 private, nine triage, and eight transition rooms. The
new ED is close to the main entrance of the hospital, and the former location will house an expanded
outpatient surgery center upon completion in 2013 (Cone Health website, accessed Nov. 26, 2012).
»» C
one Health expects its new North Tower addition to The Moses H. Cone Memorial Hospital will be
completed in June 2013. The expanded facility will move some services from the existing facility, and
will include 16 operating rooms, two nursing stations on each of the three floors, and an ED costing an
estimated $200 million. Vacancies left in the current facility will be renovated and completed in 2015
to include pre- and post-operating services (Cone Health website, accessed Nov. 26, 2012).
»» A
$7.7 million renovation of Annie Penn Hospital was announced in May 2012. Pending CON
approval from the North Carolina Health and Human Services, renovations to 12 ICU rooms and 27
patient-care rooms will update the technology. Construction is slated to begin in March 2013, with an
anticipated completion date of September 2014 (Cone Health website, accessed Dec. 5, 2012).
» » I n March 2013, Cone Health will open its six-bed primary-care center for treatment of sickle cell in a
renovated section of Wesley Long Hospital. The new center will be the second comprehensive treatment facility for sickle cell in the Southeast; the other facility is located in Atlanta.
Accountable care organization: Cone Health partnered with providers throughout the Greensboro region
to form the Triad HealthCare Network, its response to the lack of coordinated care in the community. THN
establishes a clinical integration network between the health system and approximately 800 participating
physicians, including 400 employed Cone Health physicians. THN was selected by CMS as one of 88 new
Shared Savings ACOs in July 2012 (Triad HealthCare Network website, accessed Nov. 29, 2012).
Medical homes: The health system’s Family Medicine Center, a clinical practice facility for the Moses
Cone Family Medicine Residency Program, is an NCQA-designated Level 3 patient-centered medical
home. Though not an NCQA-certified PCMH, Annie Penn Hospital is creating a medical home concept
for homeless and Hispanic residents of Rockingham County through its Patient Navigator Program. By
offering care in its free clinics, the program will help patients with chronic conditions receive consistent,
coordinated care to manage diseases and reduce hospitalizations (Cone Health website, accessed Dec. 17,
2012).
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Physician relationships: Cone Health began the restructuring process of its physician group, Cone Health
Medical Group, with the goal of creating a high-performing physician organization. The Provider Steering
Committee was charged with restructuring the group to be physician-led, and the physician group’s new
governing body is known as the Executive Council Charter. Formerly known as Cone Physician Network,
the organization provides primary and specialty care through 400 employed physicians in 100 Triad locations (Cone Health website, accessed Nov. 26, 2012).
Information technology initiatives: Cone HealthLink, the system-wide EMR from Epic, went live on Nov.
4, 2012, in Moses Cone Hospital, Wesley Long Hospital, the Behavioral Health Hospital, and the Cone
Health Cancer Center. Officials believe it could be upwards of 18 months for employees to adapt to the
EMR, but Cone Health is offering training to its employees to aid in the transition. Members of the Triad
HealthCare Network will also have access to EMR to better track patient data and coordinate care (Cone
Health website, accessed Nov. 26, 2012).
Telemedicine: Cone Health facilities participate in a system-wide telemedicine program, known as eLink
Critical Care. eLink, which ranked second-best in the nation based on performance, allows physicians
from multiple facilities to consult with an attending physician about patients in intensive care or with
behavior health conditions (Cone Health website, accessed Nov. 26, 2012).
Though the health system has its own telemedicine programs, Cone Health physicians also participate in
UNC Health’s oncology telemedicine program from the Lineberger Comprehensive Cancer Center. Tumor
Boards are weekly conferences where Lineberger oncologists review and consult on complex cancer cases
(UNC Lineberger Comprehensive Cancer Center website, accessed Dec. 7, 2012).
Quality programs: In addition to improving quality of care through its newly restructured Cone Health
Medical Group and the Triad HealthCare Network, Cone Health reduced its Staph healthcare-acquired
infection rate by 56 percent in 2011 after installing room disinfectant systems and other disease-preventive
measures. By reducing the HAI rate, Cone Health can maintain a lower readmission rate, particularly for
the elderly, who are more prone to infections (Cone Health website, accessed Dec. 13, 2012).
Clinical trials: The Cone Health Cancer Center was conducting 42 clinical trials in 18 different forms of
cancers in December 2012 (Cone Health website, accessed Dec. 13, 2012).
Key personnel changes: Chief Information Officer John Jenkins retired on Dec. 31, 2012, and Steve Horsley filled the vacancy beginning Jan. 1, 2013. Horsley has served as Cone Health’s vice president and associate chief information officer and was responsible for implementing the system’s EMR Cone HealthLink
(Cone Health website, accessed Dec. 5, 2012). Jeffrey Jones has been selected to fill the vacant chief financial
officer position beginning Feb. 4, 2013. Jones replaces former CFO Ken Boggs.
Awards: Moses H. Cone Memorial Hospital is considered to be one of four top-performing hospitals in the
Triad by U.S. News & World Report. The facility is high-performing in the following specialties: gastroenterology, geriatrics, nephrology, orthopedics, and pulmonology (U.S. News & World Report).
Annie Penn Hospital, Behavioral Health Center, Moses H. Cone Memorial Hospital, Women’s Hospital of
Greensboro, and Wesley Long Community Hospital are recognized as Magnet facilities by the American
Nurses Credentialing Center, the credentialing arm of the American Nurses Association.
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Novant Health
Table 4-2
Local
hospitals:
Local hospital
beds:
Physicians
employed:
Physicians
affiliated:
PBM:
GPO:
3
941
423
N/A
N/A
Novation and VHA
Acute-care hospitals:
» Novant Health Forsyth Medical Center, Winston-Salem, 849 beds
» Novant Health Kernersville Medical Center (opened March 2011), 50 beds
» Novant Health Medical Park Hospital, Winston-Salem, 42 beds
» Novant Health Medical Park Hospital, Winston-Salem, performs elective outpatient surgeries
» Novant Health Hawthorne Outpatient Surgery Center in Novant Health Forsyth Medical Center
Physician groups:
» Novant Medical Group, 423 multispecialty physicians in Triad clinics
» Northern Family Medicine, one physician, Winston-Salem
Other details:
» Five PrimeCare urgent-care clinics in Greensboro (two), Kernersville, and Winston-Salem (two)
» Owns MedQuest Diagnostic Imaging Centers, 78 clinics in Alabama, Florida, Georgia, Illinois, Missouri, North Carolina, South Carolina, and
Virginia
» Affiliated with Cleveland Clinic for cardiovascular services
» Part ownership of Lake Norman Regional Medical Center, Mooresville, with Health Management Associates
» One local hospital outside the market: Novant Health Thomasville Medical Center, Davidson County
» Parent of Salem Health Solutions, healthcare information management firm in Winston-Salem
Description
Nonprofit Novant Health is an integrated health system dually headquartered in Winston-Salem and
Charlotte. It serves residents in a region spanning from southern Virginia to Savannah, Ga., but its local
presence is anchored by Novant Health Forsyth Medical Center, a tertiary-care facility providing a full
array of emergency, medical, surgical, rehabilitative, and behavioral health services. Novant Health has
10 additional hospitals in North Carolina, South Carolina, and Virginia (Novant Health website, accessed
Dec. 3, 2012).
Novant Health accounts for 27 percent of inpatient discharges and 27 percent of total acute-care beds in the
local market. The average occupancy rate is 67 percent, and the average length of stay is 5.0 days. Medicare
and Medicaid account for an average 25 percent and 21 percent, respectively, of acute-care discharges
(based on the most recent federal Medicare hospital statistics from Billian’s HealthDATA). Discharge,
occupancy, average length of stay, and Medicare and Medicaid data do not include Kernersville Medical
Center, which opened in March 2011.
At Novant Health Forsyth Medical Center, specialty centers include Novant Health Forsyth Rehabilitation
Center; Novant Health Maya Angelou Center for Women’s Health & Wellness; Novant Health Heart & Vascular Institute, which is affiliated with the Cleveland Clinic; and Novant Health Derrick L. Davis Cancer Center.
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Novant Health was formed by the 1997 merger of Carolina Medicorp of Winston-Salem and Presbyterian
Health Services of Charlotte. Thomasville Medical Center joined the system in 1997, and Brunswick Community Hospital joined in 2006. In March 2011, Novant opened its Novant Health Kernersville Medical
Center, a 50-bed acute-care hospital in the Triad market. The new Kernersville hospital and new facility in
Brunswick replaced outdated facilities.
News and Analysis
In February 2013, Novant Health announced it would implement a rebranding strategy systemwide in an
effort to better associate its operations, including its Greensboro-based hospitals, with the Novant brand.
While Presbyterian facilities are recognized regionally, the Novant name carries national recognition. As
of April 17, 2013, all Greensboro facilities feature Novant Health before the name of the facility. All other
medical facilities, including its clinics, carry the Novant name. Implementation cost, which includes new
signage, logo, and consultation with strategic marketing firm Prophet, was not disclosed.
Expansion plans: Competition between Novant Health and Wake Forest Baptist Health continued to
escalate in 2012, leading to competing expansion projects with duplicate services. While Novant primarily
focused on strategic partnerships outside the region, the health system did pursue other regional expansion projects:
»» C
onstruction has started on the Novant Health Clemmons Medical Center. The first phase of the
project includes the emergency department, outpatient services, and physician offices, and was completed in early 2013. Phase II of construction will include the $98 million, 50-bed medical center, with
four operating rooms, a 12-bed emergency department, and diagnostic imaging; no completion date
has been provided.
»» N
ovant Health applied for CON approval to convert its existing Forsyth operating rooms to hybrid
operating rooms and implement a new angioplasty system; the project is estimated to cost $2.7 million
(Billian’s HealthDATA).
Competition: Novant Health continued its fight to halt construction on Wake Forest Baptist Health’s proposed ambulatory-surgery facility. In November 2012, the N.C. Court of Appeals denied Novant’s appeal
to block construction of the center, which Novant asserted would duplicate services in the market. The
following month, Novant requested the N.C. Court of Appeals rehear the case.
Partnerships: Though Novant Health continued its expansion and construction projects in the Triad
region, the health system’s main strategy in 2012 was expansion outside the region and the state. Novant
Health Shared Services and Savannah, Ga.-based Memorial Health, serving residents in 35 counties in
Georgia and South Carolina, announced an agreement for a strategic partnership in August 2012 that
will focus primarily on operational and strategic programs to provide integrated care. After the successful implementation of the partnership, Novant Health representatives began exploring other expansion
opportunities in Georgia, where other health systems have proposed partnerships (The Business Journal).
As other health systems continue regional and statewide consolidations, Novant will continue to explore
opportunities in new territories.
Accountable care organization: Novant Health and Cigna announced a partnership for a collaborative
accountable care initiative for more than 60,000 Cigna members across the Carolinas, effective April 1,
2013. Novant’s Greensboro-based hospitals and physicians are participants in the initiative.
Medical homes: In October 2012, Novant announced that 12 of its physician practices were recognized
by NCQA as PCMHs. These clinics are in addition to the 33 clinics that were certified as PCMHs by the
NCQA in 2011 (Novant website, accessed Dec. 3, 2012). The health system had 73 physicians recognized
for providing PCMH coordinated care in Winston-Salem, and approximately 20 other physicians were
recognized in Clemmons, Greensboro, and Kernersville (NCQA website, accessed Dec. 17, 2012).
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Novant Health is also one of 16 health systems and provider organizations nationwide that are participating in a patient-centered medical neighborhood demonstration project. Funded by a three-year, $20.8
million grant awarded by the Center for Medicare and Medicaid Innovation in June 2012, the project is a
collaboration among Leawood, Kan.-based TransforMED, Phytel, and VHA.
Information technology initiatives: Novant Health began implementing an integrated EMR system in
its outpatient facilities, hospitals, and clinical organizations, costing an estimated $600 million for the
four-year project. After setting up the system in its clinics, implementation began in Novant’s 13 hospitals
in 2012 (Novant Health website, accessed Dec. 3, 2012). With the health system’s expansive reach, a fully
integrated EMR will be an asset to Novant’s physicians and patients in the multistate service region.
Medicare readmissions: Though competition is extremely tense in Winston-Salem, Novant has partnered
with competitor Wake Forest Baptist Health and other hospitals to reduce hospital readmissions. The
Northwest Triad Care Transition Program, the first federally funded Community-based Care Transitions
Program in North Carolina, was established to lower readmissions in the Winston-Salem area for FFS
Medicare patients and eligible Medicaid beneficiaries.
Novant also partnered with Wake Forest Baptist on a community initiative, working closely with local
nonprofit organizations to engage them in an effort to lower the local Medicare readmission rates at least
20 percent for 3,000 beneficiaries.
Novant Health Forsyth Medical Center did not receive any reimbursement penalties as a result of Medicare
readmission results announced by the Centers for Medicare & Medicaid Services in November 2012. The
hospital ranked average, compared nationally, in the six categories measured for readmissions for heart
attack, heart failure, and pneumonia.
Telemedicine: Novant Health Neurosciences Network Solution diagnoses and treats stroke patients in
rural communities throughout the service area. First established in its Forsyth hospital, Novant Health
Neurosciences Network Solution has expanded to include the remaining service area. Rural hospitals in
North Carolina, South Carolina, and Virginia have access to Novant’s physicians to better treat stroke
patients who have limited access to quality care (Novant Health website, accessed Dec. 14, 2012).
Health plan contracting: In August 2012, Novant and Aetna, the fifth-largest insurer in the market,
announced a new contract. The multiyear agreement also establishes a value-based payment model for
physicians affiliated with PCMH-certified clinics; physicians will be compensated through a care-management fee, as well as compensation for achieving established quality and cost goals.
Hospital layoffs: In May 2012, Novant Health announced it would be laying off 289 employees in an effort
to control costs while still providing quality care, with 150 of these layoffs in the Triad. The announced
layoffs were a result of reduced healthcare spending and decreased reimbursement rates.
Awards: Novant Health Forsyth Medical Center, the ninth-ranked hospital in North Carolina, is a highperforming facility in Greensboro for diabetes/endocrinology, gastroenterology, geriatrics, nephrology,
orthopedics, and pulmonology (U.S. News & World Report).
Novant Health Forsyth Medical Center is also recognized as a Magnet facility by the American Nurses
Credentialing Center, the credentialing arm of the American Nurses Association.
Parent company earnings: In 2011, Novant Health earned net income of $1 million, a significant decrease
in net income from 2010’s $158 million owing to a $112 million decrease in investment performance from
2010 to 2011 (Novant Health press release).
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Table 4-3
Local
hospitals:
Local hospital
beds:
Physicians
employed:
Physicians
affiliated:
PBM:
GPO:
3
865
1,095
N/A
N/A
MedAssets Supply Chain Systems, Premier, and University
HealthSystem Consortium
Acute-care hospitals:
» Wake Forest Baptist Medical Center (including Brenners Children’s Hospital), Winston-Salem, 840 beds
» Wake Forest Baptist Health-Davie Hospital, Mocksville, 25 beds
» CompRehab outpatient rehabilitation services, housed in a Winston-Salem clinic
» Sixteen freestanding outpatient dialysis clinics in the Triad region
» Outpatient Neurology Clinic based in Winston-Salem
» Downtown Health Plaza, a multispecialty outpatient center located in Winston-Salem
Physician groups:
» Wake Forest Baptist Health, 859 physicians affiliated with Wake Forest School of Medicine
» Wake Forest Medical Center Community Physicians, 100 primary-care physicians treating patients in Davie, Forsyth, Stokes, Surry, and Wilkes
counties
Other details:
» Wake Forest University Health Sciences, which manages Wake Forest School of Medicine and Piedmont Triad Research Park
» Wake Forest Comprehensive Cancer Center, an NCI-designated cancer center in Winston-Salem
» Medical Pavilion-Mocksville, Davie County, urgent-care center
» Affiliation with Cone Health to use Moses H. Cone Memorial Hospital as a community teaching hospital
» Affiliation with Novant Health for emergency residents to learn at the community’s top obstetrics hospital
» One hospital outside the market: Wake Forest Baptist Health–Lexington Medical Center, Davidson County
Description
Wake Forest Baptist Health, Forsyth County’s largest employer, is an integrated healthcare system based
in Winston-Salem that offers acute-care, long-term care, rehabilitation, and outpatient services, as well
as community health and information centers. The medical center represents a partnership that began
in 1941 among North Carolina Baptist Hospital (now Wake Forest Baptist Medical Center), Wake Forest University Health Sciences, and Wake Forest University Physicians. Wake Forest University Baptist
Health has one of five Level I trauma centers in North Carolina and the only Level I trauma center in the
Greensboro region.
Wake Forest Baptist Health accounts for 22 percent of inpatient discharges and 24 percent of total acutecare beds in the local market. The average occupancy rate is 71 percent, and the average length of stay is 6.0
days. Medicare and Medicaid account for an average 31 percent and 16 percent, respectively, of acute-care
discharges (based on the most recent federal Medicare hospital statistics from Billian’s HealthDATA).
Located on the main hospital campus, Brenner Children’s Hospital is North Carolina’s only pediatric Level I trauma center. Services affiliated with the hospital, which primarily serves 26 counties in
northwestern North Carolina and southwestern Virginia, include the National Cancer Institute-designated comprehensive cancer center, a heart center, neurosciences, women’s health, and primary care.
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Through agreements with Wake Forest Baptist Health-Davie County and Stokes-Reynolds Memorial Hospital, Wake Forest University Baptist Health has a presence in Davie
and Stokes counties, located to the north and southwest of Winston-Salem, respectively.
Wake Forest University Health Sciences includes Wake Forest University School of Medicine, 14 dialysis
centers, One Technology Place, Richard H. Dean Biomedical Research Building, and other buildings in the
Piedmont Triad Research Park. Health Sciences is the driving force behind the expansion of a downtown
research park in Winston-Salem.
News and Analysis
Wake Forest Baptist Health spent much of 2012 strategically restructuring its operations and cost structure to better adapt to upcoming changes and growing concerns over the upcoming reimbursement cuts
affiliated with the national healthcare reform. A Roadmap to Excellence, a multiyear plan first introduced
in 2009, also lays out the health system’s strategies for redesigning its operating model to improve quality
of care for patients and lower costs. As part of its strategic plan, the health system is cutting 950 full-time
positions, including 475 filled positions, by the end of June 2013. Ultimately, the academic health system
wants to provide better, more cost-effective care to the community. Moving forward in 2013, the health
system will need to monitor the effectiveness of implemented policies before deciding to make any further
changes.
Financial performance: The North Carolina Medical Care Commission announced in late 2012 that it
would sell health-facility revenue bonds for Wake Forest Baptist Obligated Group, which is composed of
Wake Forest Baptist Medical Center, Wake Forest University Health Sciences, and Wake Forest Baptist
Medical Center. The bonds received an AA– rating from Standard & Poor’s; however, the ratings agency
downgraded the hospital bonds’ outlook from stable to negative after Wake Forest Health did not meet
operating expectations. Moody’s Investors Service believes the bonds’ outlook will remain stable based on
its appraisal of the bonds. Moody’s affirmed its Aa3 rating, which is its equivalent of the AA– rating from
Standard & Poor’s.
Expansion plans: As an academic medical center in North Carolina, Wake Forest Baptist Medical Center
has a more-open application period to apply for equipment and facility approval, unlike other facilities in
the region. Though the health system announced layoffs, it is still expanding its services and facilities in
the Winston-Salem area to include the following:
»» W
ake Forest Baptist Medical Center began construction on its medical complex in Advance, consisting of an outpatient center and medical office building. Known as Wake Forest Baptist Health–West
Campus, the campus will feature a four-story, 60,000-square-foot medical office building, and is
expected to be completed in late summer 2013. Construction on the attached, 100,000-square-foot
outpatient center will begin in fall 2013. Phase II of the development, which will feature 50 beds and
inpatient services, is expected to be completed sometime in 2017 and will replace the outdated Davie
County facility.
»» W
ake Forest Baptist Health received CON approval in 2010 to build a new ambulatory-surgery center
near the system’s main campus in Winston-Salem; the $38.7 million facility is said to house eight new
operating rooms. Construction has been delayed due to a lawsuit filed by competing Novant Health in
December 2011, which Novant lost in the N.C. Court of Appeals in November 2012. The next month,
Novant requested a new hearing from the N.C. Court of Appeals for the surgery center.
» » I n September 2012, Lexington Medical Center applied for CON approval to expand its current ED,
which would be the medical center’s second ED expansion proposal in 2012. After receiving CON
approval, construction began on the $1.8 million expansion on the Lexington Medical Center ED,
which includes 5,000 square feet of needed space to accommodate for increased ED patient volume.
The new $10 million project would renovate 2,600 square feet of existing hospital space and add 7,500
square feet to the facility (The Business Journal).
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»» L
exington Medical Center also applied in September 2012 for CON approval to purchase a new CT
scanner worth $2 million. The hospital was granted approval in December 2012 for the scanner (The
Business Journal).
Medical homes: Wake Forest Baptist Health has 28 physicians who are recognized as PCMH providers by
the NCQA, primarily practicing family medicine (NCQA website, accessed Dec. 17, 2012).
Medicare readmissions: As part of federal healthcare reform’s efforts to reduce elderly readmission rates,
health systems are experiencing reimbursement decreases for excessive readmissions. Wake Forest Baptist
Medical Center will see a 0.82 percent reduction in Medicare reimbursements based on its performance
in readmissions of patients with heart attack, heart failure, and pneumonia. Estimated losses as a result of
reimbursement reductions are $730,000 to $980,000.
To reduce unnecessary readmissions, Wake Forest Baptist Medical Center has partnered with local
competitor Forsyth Medical Center, owned by Novant Health, for two community-based initiatives. The
Northwest Triad Care Transitions Program, formed by area hospitals and other providers, was the first
North Carolina-based program to receive funding from CMS and participate in Community-based Care
Transition Program. The NTCTP was established to reduce the readmission rate by 20 percent among feefor-service Medicare and eligible Medicaid beneficiaries in Davidson, Forsyth, and Surry counties who
have been hospitalized for a serious medical condition.
The two competitors are also working with local community organizations on a separate initiative for
approximately 3,000 Medicare beneficiaries. Health systems hope that such community collaborations can
reduce hospital readmissions by 20 percent in the targeted population (Winston-Salem Journal).
Information technology initiatives: As an adopter of electronic medical records in 1998, Wake Forest Baptist has seen the benefits of a having an EMR system, as well as the challenges of the early technology. Since
the previous EMR did not integrate fully throughout the system, Wake Forest is in the process of updating
its EMR technology to allow for full integration and patient access (Wake Forest Baptist Medical Center
website, accessed Nov. 30, 2012).
Telemedicine: Wake Forest Baptist Health continues to expand its telemedicine programs, which began
with North Carolina’s first Telestroke Network at Wake Forest Baptist Medical Center’s Primary Stroke
Center. Wake Forest Baptist Telestroke Network has partnered with community hospitals in 24 western
North Carolina and southern Virginia counties to aid in the diagnosis and treatment of strokes. The health
system recently partnered with Raleigh-based WakeMed to bring a telestroke program to Granville Health
System, located in Oxford, N.C. Wake Forest Baptist physicians will provide consultations for stroke
patients in Oxford, using equipment provided by WakeMed.
The health system was once again first in the state, as well as the southeastern United States, to add a telemedicine program for concussion to its neurology department at Wake Forest Baptist Health-Lexington
Medical Center. Its Sports Teleconcussion Network, launched in July 2012, diagnoses and treats student
athletes suffering from concussions throughout Winston-Salem with a mobile robot (Wake Forest Baptist
Health website, accessed Nov. 30, 2012).
Charity care: As a safety net hospital for the region, the hospital provided $61.8 million in uncompensated
charity care in its fiscal year 2011 (Wake Forest Baptist Health website, accessed Nov. 30, 2012).
Clinical trials: As an academic medical facility, Wake Forest Baptist Health offers hundreds of clinical trials to patients diagnosed with different disease states. Wake Forest University doctoral faculty members
oversee the trials, which focus on five trial categories: diagnostic, preventive, quality of life, screening, and
treatment (Wake Forest Baptist Health website, accessed Dec. 14, 2012).
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Awards: According to U.S. News & World Report’s Honor Roll list of hospitals, Wake Forest Baptist Medical Center ranks second in North Carolina. It is a top-ranking facility in Greensboro for cancer, gastroenterology, geriatrics, nephrology, neurology/neurosurgery, pulmonology, and urology.
North Carolina Baptist Hospital of Wake Forest University Baptist Medical Center is recognized as a
Magnet facility by the American Nurses Credentialing Center, the credentialing arm of the American
Nurses Association.
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Other Health Systems and Hospitals
Nonprofit High Point Regional Health System was developed in 1996 after adding additional services
beyond hospital care, and is governed by a volunteer board of trustees. The anchor of the system is High
Point Regional Hospital. Within the health system are six primary centers of care: the Carolina Regional
Heart Center, The Hayworth Cancer Center, the Neuroscience Center, the Women’s Center, the Emergency
Center, and the Piedmont Joint Replacement Center. It also includes a rehabilitation center, the Millis
Regional Health Education Center, a regional wound center, the Diabetes Self Care Management Center,
the Sleep Lab, the Vascular Center, and High Point Behavioral Health (High Point Regional Health System
website, accessed Dec. 5, 2012).
High Point Regional Hospital accounts for 11 percent of inpatient discharges and 9 percent of total acutecare beds in the local market. The average occupancy rate is 56 percent, and the average length of stay is
4.0 days. Medicare and Medicaid account for an average 32 percent and 23 percent, respectively, of acutecare discharges (based on the most recent federal Medicare hospital statistics from Billian’s HealthDATA).
High Point Regional Health System has affiliations with North Carolina’s two other academic medical
centers, which bolsters the local health system’s cancer and cardiovascular programs. The Hayworth
Cancer Center is affiliated with Wake Forest Baptist Health’s Comprehensive Cancer Center, giving High
Point physicians access to Wake Forest oncological resources. In January 2012, High Point entered into an
affiliation with Durham-based Duke Medicine for its cardiovascular and oncology programs.
In addition to its hospital services, High Point Regional Health’s Regional Physicians employs approximately 40 physicians and 23 additional providers in 19 clinical settings. Specialties include internal medicine, reproductive medicine, women’s health, neurology, occupational health, and orthopedics (Regional
Physicians website, accessed Dec. 5, 2012).
In late September 2012, High Point Regional Health System announced that its board of trustees had voted
to merge with UNC Health Care, based in Chapel Hill. Given its status as a state-owned organization, UNC
Health was able to bypass FTC regulatory review for the merger, finalizing the deal in April 2013. UNC
Health will spend $200 million to improve the High Point–based health system: $150 million will be put
towards improvements and the remaining $50 million will help establish a High Point community fund.
High Point Regional management was retained, as was the hospital’s name.
The health system received final state approval on its $56.3 million expansion and renovation project in
September 2012. High Point Regional allocated funds for its three-story, 33,000-square-foot expansion
of High Point Regional Hospital, which will include 11 renovated ORs and improvements to its existing
infrastructure.
According to the U.S. News & World Report Honor Roll, High Point Regional Health System ranks
fourth in North Carolina hospital rankings. It is a nationally ranking facility in Greensboro for diabetes/
endocrinology. Hayworth Cancer Center is consistently receives the highest score among Piedmont Triad
hospitals for cancer care.
The hospital is also recognized as a Magnet facility by the American Nurses Credentialing Center, the
credentialing arm of the American Nurses Association.
Randolph Hospital in central Randolph County offers inpatient and outpatient services including ob/gyn,
emergency, home healthcare, intensive care, surgical, pain management, rehabilitation, and wellness programs. Its Randolph Cancer Center is a collaborative effort of Randolph Hospital and Cone Health System
(Randolph Hospital website, accessed Dec. 6, 2012).
In November 2012, CMS announced Randolph Hospital was one of the Greensboro-area hospitals to receive
cuts related to readmission penalties; physicians will see a 0.93 percent cut in Medicare reimbursements out
of a maximum 1 percent reduction, making it one of the highest reductions in the Greensboro region.
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Table 4-4:
Greensboro Hospitals
Name
City
Beds
Moses H. Cone Memorial Hospital, Annie Penn Hospital, Wesley Long Community Hospital,
and The Women’s Hospital of Greensboro
Greensboro
937*
Novant Health Forsyth Medical Center
Winston-Salem
849
Wake Forest Baptist Medical Center (includes Brenners Children’s Hospital)
Winston-Salem
840
High Point Regional Hospital
High Point
335
Morehead Memorial Hospital
Eden
229
Randolph Hospital
Asheboro
145
Stokes-Reynolds Memorial Hospital
Danbury
65
Novant Health Kernersville Medical Center (opened March 2011)
Kernersville
50
Novant Health Medical Park Hospital
Winston-Salem
42
Wake Forest Baptist Health-Davie Hospital
Mocksville
25
Hoots Memorial Hospital
Yadkinville
15
*Figure includes Behavioral Health Center.
Sources: HealthLeaders-InterStudy, 2013; based on data from Billian’s HealthDATA, 2012.
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Physicians
O
Sector Outlook
Greensboro’s largest physician groups have the benefit of integrated technology and innovative programs
implemented by their parent health systems. Independent Cornerstone Health Care, selected as a Medicare
Shared Savings ACO, is proving to be one of the region’s most innovative physician groups, partnering with
the market’s largest health plans for quality and cost initiatives. Meanwhile, smaller physician groups have
affiliated with Cone Health’s Triad HealthCare Network (also a Medicare Shared Savings ACO) to better
comply with federal healthcare reform mandates. Local physician organizations will be active participants
in quality initiatives in the community implemented by health systems and health plans, resulting in further changes to compensation models and care coordination. As healthcare reform deadlines approach,
smaller physician practices will be able to draw from health systems’ resources to better implement necessary changes.
Highlights:
The physician sector is moderately consolidated, with many providers connected to major health
systems that dominate the market, including Cone Health, which is affiliated with smaller groups in
the market such as LeBauer Healthcare, Eagle Physicians & Associates, and Greensboro Radiology.
The two largest physician groups are both affiliated with health systems—Novant Medical Group and
Wake Forest Baptist Health. The market also has a large independent physician group, Cornerstone
Health Care, which is launching a value-based system of caring for patients. Also affiliated with the
Wake Forest Baptist health system is Wake Forest Baptist Community Physicians, a group of primarycare providers in Winston-Salem and the surrounding region.
» » Physician supply:
Based on national averages, Greensboro market has an excess of office-based primary-care physicians
and specialists. There are approximately 71 primary-care physicians per 100,000 residents in the
Greensboro market, which is greater than the national average 64 primary-care physicians. Similarly,
Greensboro’s residents have 125 specialists per 100,000 population, compared to 114 specialists that
make up the national average (SK&A Information Services). Even though North Carolina has an
excess of physicians per 100,000 residents, the state has experienced a shortage of pediatric primarycare physicians and specialists (U.S. Department of Health & Human Services.
There are more specialists and primary-care providers per 100,000 residents in the region than the
national average. This may result from Wake Forest Baptist’s academic medical center status and the
region’s close proximity to two other North Carolina academic medical communities: Duke Medical
and UNC Health.
» » Nurse practitioners and physician assistants:
North Carolina has 3,976 total licensed nurse practitioners as of 2011. This number translates to 41
nurse practitioners per 100,000 population, versus 58 per 100,000 nationwide, ranking the state near
the bottom of all 50 states and the District of Columbia (Kaiser Family Foundation analysis of data
from the Pearson Report).
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North Carolina has 4,040 total physician assistants as of 2010. This number translates to 42 physician
assistants per 100,000 population, versus 27 per 100,000 nationwide, ranking North Carolina 11thhighest among all 50 states and the District of Columbia (Kaiser Family Foundation analysis of data
from the American Academy of Physician Assistants).
» » ACOs:
In addition to Triad HealthCare Network (which includes physician organizations and Cone Health),
Cornerstone Health Care has participated with Medicare as an ACO since July 2012. Based in High
Point, Cornerstone also has 313 physicians from ACO group practices partnered with Cigna to treat
Medicare enrollees, and announced new ACO initiatives with UnitedHealthcare and its subsidiary
Optum, and with Blue Cross and Blue Shield of North Carolina.
» » Medical homes:
Approximately 280 physicians in the Triad are recognized by the National Committee for Quality
Assurance as participating patient-centered medical home providers (NCQA website, accessed Nov.
20, 2012). PCMHs are beneficial for monitoring patient conditions and ensuring patients follow
prescribed medication therapies, especially with the high prevalence of asthma, chronic obstructive
pulmonary disease, and hypertension in the region.
» » Reimbursement:
Although local health plans have typically compensated physicians in the traditional fee-for-service
payment model, they are transitioning to compensation models for quality. Blue Cross and Blue Shield
of North Carolina, the region and state’s largest insurer, reimburses physicians on a FFS rate, and has
implemented a payment incentive program that rewards physicians for providing quality care.
As part of its push to implement innovate care programs, Cornerstone Health Care moved to a
pay-for-performance model—a fitting move, given the physician group’s involvement in Cigna’s
collaborative ACO.
Physician groups affiliated with the local health systems are also experiencing changes in payment
models, often a result of restructuring. Wake Forest Baptist Health physicians are moving away from
a FFS payment model towards rewarding physicians for high-quality care and outcomes, as are Cone
Health and its Triad HealthCare Network.
» » Government reimbursement levels:
The North Carolina General Assembly voted and enacted the 2013 state budget, despite a veto from outgoing Gov. Bev Perdue. One provision in the new budget froze reimbursement rates at the current level
for the remainder of the fiscal year (North Carolina Medical Society website, accessed Nov. 20, 2012).
» » Information technology:
The Triad physician groups that are affiliated with local health systems are beginning to see the
benefits of electronic medical records. In the past year, Cone Health and Novant Health have each
implemented an EMR in their hospitals and clinics; early adopter Wake Forest Baptist Health is in the
process of updating its system for better system-wide integration. Smaller provider groups are benefiting from EMR technology through their partnerships with larger health systems.
» » EMR/e-prescribing:
Approximately 58 percent of office-based physicians in North Carolina used an EMR system in 2011,
and 31 percent had a system that met the criteria for a basic system (Surescripts).
North Carolina is seventh-highest for Safe-Rx, Surescripts’ e-prescribing program,, where 80 percent
of physicians routed prescriptions electronically in 2011 (Surescripts website, accessed Nov. 20, 2012).
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» » Research:
Providers may note a tighter budget and fewer initiatives for research opportunities and clinical trials
as 2014 draws nearer. Part of Wake Forest Baptist Health’s restructuring effort was to help the system
maintain funding for research projects, since there is a greater emphasis on lower spending and costs
throughout the industry, leading to lower federal funding. Also affecting research funding is the
Triad’s struggling economy, which has resulted in fewer private investments (Wake Forest Baptist
Health).
» » Retail/urgent care:
Retail and urgent-care clinics are abundant in the Greensboro market, in part because of the region’s
high uninsured rate. National pharmacy chains CVS and Walgreens each have a presence in the Triad
region’s retail clinic market. Prime Care, offered by Novant Health, has five urgent-care locations
throughout the High Point area. Independent Optimus Urgent Care and Family Practice has one
clinic in Greensboro, and FastMed, which has locations in Greensboro and Winston-Salem, is based
in both North Carolina and Arizona.
» » Video conferencing:
While local physician groups are not as involved in e-visits as are physicians in other parts of the
country, BCBS of North Carolina has established a reimbursement policy for physicians who treat
via the Internet. The Blue plan began its initiative in 2009, with little participation from healthcare
providers, as part of its overarching goal to provide member lives with better access to care (BCBS of
North Carolina website, accessed Dec. 13, 2012).
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Table 5-1
Type: Academic
Internal Guidelines: Yes
Total Physicians: 859
Medical Management: Yes
Primary-Care Physicians: N/A
Clinical IS: Yes
Wake Forest Baptist Health, based in Winston-Salem, is the integrated health system composed of physicians who also serve as faculty for Wake Forest University School of Medicine, the health system’s parent
organization. Physicians treat patients in 100 different specialties offered through Wake Forest Baptist
clinics, hospitals, and other facilities. Primary care is offered through physicians who specialize in family
medicine, internal medicine, and gynecology (Wake Forest Baptist Health website, accessed Dec. 20, 2012).
The physician group has 28 physicians in its Winston-Salem facilities who are recognized by the NCQA as
PCMH providers (NCQA website, accessed Dec. 14, 2012).
Novant Medical Group
Table 5-2
Type: Health-system owned
Clinical IS: Yes
Novant Medical Group, the physician subsidiary of nonprofit Novant Health, has a total of 1,141 physicians who practice in 348 clinical locations in North Carolina, South Carolina, and Virginia. Specifically
in the Piedmont Triad, Novant Medical’s 423 physicians are based in 103 clinics located within 50 miles
of Greensboro, specializing in primary and specialty care. Primary care includes family and internal
medicine, pediatrics, and women’s health. Patients can also see physicians who specialize in cardiology,
dermatology, endocrinology, ear/nose/throat, neurology, and sports medicine (Novant Medical Group
website, accessed Dec 7, 2012).
Novant Medical Group also has an affiliation with the Northern Family Medicine, which is a single-provider physician office in Greensboro. Physician M. Chan Badger, M.D., focuses on primary care, preventive
screenings, and disease management (Northern Family Medicine website, accessed Dec. 10, 2012).
Novant Medical Group has received recognition by and certification from the National Committee for
Quality Assurance for treatment of diabetes, heart disease, and stroke. Forty-five Novant Medical Group
clinics throughout the service area have been certified as patient-centered medical homes by the NCQA.
In addition to its NCQA-certified PCMH, Novant Medical Group works with Medicare beneficiaries who
have been recently discharged from the hospital and have complex medication therapies. Safe Med pharmacists work with patients to assist with medication management, as well as prevent adverse drug effects.
(Safe Med was awarded the American Pharmacist Association Foundation Pinnacle Award in 2009.) As
a result, Novant has decreased its ADE hospitalizations by 14 percent (Novant Health website, accessed
Dec. 14, 2012).
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Cone Health Medical Group
Table 5-3
Type: Employed group
Clinical IS: Yes
Physicians at Cone Health Medical Group, the physician subsidiary of Cone Health, are directly employed
by the health system. Formerly known as Cone Physician Network, the practice is composed of primarycare and multispecialty providers who treat patients in 100 locations in the Greensboro market. Primary
care includes family and internal medicine, ob/gyn, pediatrics, and urgent care, and specialties offered
include cardiology, endocrinology, gastroenterology, oncology, pulmonology, and urology. Operations
performed by physicians include outpatient general surgeries, vascular surgeries, and orthopedic surgeries
at select clinic locations throughout the service area. All Cone physicians participate in Triad HealthCare
Network, a CMS-designated Shared Savings ACO.
As part of its rebranding efforts, Cone Health restructured the medical group through its creation of the
Provider Steering Committee and the Executive Council Charter. The Provider Steering Committee was
charged with restructuring the organization to be a physician-led organization. Cone Health Medical
Group’s Executive Council Charter was established in September 2012 as the group’s governing body (Cone
Health website, accessed Dec. 7, 2012).
Cornerstone Health Care
Table 5-4
Type: Group practice
Total Physicians: 374*
Clinical IS: Yes
*Includes mid-level practitioners.
Headquartered in High Point, Cornerstone Health Care is a multispecialty, physician-owned group that
began in 1995 with 15 clinics staffed by 42 physicians. Since then, Cornerstone has grown to be one of the
largest independent physician practices in the Triad, with 115 clinics in the region and 374 physicians and
mid-level practitioners who specialize in cardiology, family medicine, gynecology, gastroenterology, inpatient services, pain management, pediatrics, surgery, and urgent care. Cornerstone also offers Cornerstone
Clinical Pharmacy Services, which provides medication management programs for those with high cholesterol and diabetes, as well as complex medication therapy, smoking cessation, and surgery preparations
(Cornerstone Health Care website, accessed Dec. 6, 2012).
Cornerstone continues to grow through partnerships with small regional physician groups. Since January 2013, it has partnered with two physician groups and serves 11 central counties. The physician group
formed partnerships with Alexander County’s Bethlehem Family Practice and Jonesville Family Medical
Center, serving Yadkin County. Cornerstone Health is expanding its reach into the west-central counties
of North Carolina, and its physician groups have access to Cornerstone’s value-based care expertise (Cornerstone Health Care website, accessed May 9, 2013).
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Cornerstone Health is a unique example in Greensboro of a physician group that has value-based agreements with all accepted carriers. Taking its knowledge of value-based care and agreements, Cornerstone
Health is launching a consulting business to help other physician groups form value-based care. Cornerstone Health Enablement Strategic Solutions will assist other physician groups with implementation,
financial analysis, patient engagement, quality management, and network development (Cornerstone
Health Care website, accessed May 9, 2013).
Throughout 2012, Cornerstone Health Care partnered with health plans with a regional presence to
implement value-based programs including ACOs, PCMHs, and narrow networks. In April 2012, Cigna
announced that Cornerstone was one of 22 physician organizations selected to participate in the health
plan’s collaborative ACO. Cornerstone Health Care has 313 physician participants who treat approximately
5,000 Cigna lives. Physicians are compensated based on improving care and lowering costs for these individuals.
Announced mid-January 2013, the physician group is partnering with UnitedHealthcare and Optum to
form another ACO. Cornerstone providers will have access to Optum’s technology to access patient data
to outline the best treatment course, as well as receive monthly updates regarding patient care. Providers
will be compensated on a pay-for-performance model for providing quality care.
Cornerstone and Blue Cross and Blue Shield of North Carolina launched a collaborative ACO in May 2013,
serving 11 counties in central North Carolina. While care coordinators will work with all BCBS members,
the ACO will focus on managing care and medications for at-risk patients and those with chronic conditions. The Blue plan was the final carrier needed to form value-based agreements with all of Cornerstone’s
contracted insurers (Blue Cross and Blue Shield of North Carolina press release).
The physician group has formed a PCMH and clinic, dubbed Cornerstone Care Outreach, for Medicaid
and low-income Medicare patients. The initiative, which launched in March 2013, provides longer appointment times for patients so they can form a care management protocol with their doctors. Patients are
assigned care-coordination nurses, who ensure patients are adhering to prescribed medication therapies
and attending follow-up appointments (Cornerstone Health Care website, accessed May 10, 2013).
Aetna’s PCMH initiative began including Cornerstone physician practices in July 2012. Twenty-nine of
Cornerstone’s primary-care clinics were certified as PCMHs by the NCQA.
In October 2012, Cornerstone joined High Point Regional Health System and Randolph Hospital to form
Coventry of the Carolinas’ new narrow-network product. Carelink, which is offered to Triad employees,
gives a 10 percent reduction in premiums as an incentive to use providers in the narrow network; insured
lives can use other providers from Coventry’s network, but they will not receive the discounted premium.
Prior to participating in these initiatives, Cornerstone Health Care switched from a FFS payment model
to a pay-for-performance model.
Additional Physician Organizations
» » Wake Forest Baptist Medical Center Community Physicians:
Affiliated with Wake Forest Baptist Medical Center, Wake Forest Baptist Health Community Physicians
was developed in 1994 by a group of local physician organizations that wanted to provide more affordable
access to quality care. Nearly 100 primary-care physicians specialize in family medicine, internal medicine, pediatrics, geriatrics, sports medicine, diabetes treatment, women’s health, and disease prevention.
Each practice within its six-county service area in North Carolina emphasizes its four tenets of successful
healthcare: access to care, quality of care, patient satisfaction, and cost of care (Wake Forest Baptist Health
website, accessed Dec. 11, 2012).
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» » LeBauer HealthCare:
Founded in 1931, LeBauer HealthCare has 73 primary- and specialty-care physicians who practice in 13
locations throughout the Triad region; six of the clinical locations specialize in cardiovascular care. The
independent physician group also specializes in behavioral health, with four licensed providers practicing in four local clinics. LeBauer HealthCare is affiliated with Cone Health, and its physicians participate
in the health system’s Triad HealthCare Network (LeBauer HealthCare website, accessed Nov. 30, 2012).
» » Eagle Physicians:
Eagle Physicians is composed of 64 multispecialty physicians who practice in six locations throughout
the Greensboro market. In addition to primary, pediatric, and geriatric care, physicians also specialize
in cardiology, endocrinology, gastroenterology, ob/gyn, and rheumatology. Though not affiliated with
a health system, Eagle Physicians members have privileges at Cone Health facilities (Eagle Physicians
website, accessed Nov. 30, 2012). All physicians participate in Cone Health’s Triad HealthCare Network,
a CMS Shared Savings ACO.
» » Greensboro Radiology:
Greensboro Radiology expanded its practice to 52 physicians in January 2012 when it merged with High
Point Radiology Services. Eight High Point radiologists purchased interest in Greensboro Radiology and
its subsidiaries Canopy Partners and Greensboro Imaging (discussed below), which is jointly run with
Cone Health. Physicians in the 45 outpatient centers and 12 hospitals in the Piedmont Triad and southern
Virginia region provide the following services: CT scans, X-rays, interventional radiology, MRIs, nuclear
medicine, vascular care, ultrasounds, virtual colonoscopies, and radiofrequency ablation (Greensboro
Radiology website, accessed Dec. 11, 2012).
» » Greensboro Imaging:
In 1998, Greensboro Radiology and Cone Health partnered to create a diagnostic imaging group, which in
2005 officially became known as Greensboro Imaging. Presently, 48 physicians and four physician assistants staff four imaging centers and The Breast Center located in the Triad region. To stay connected with
its affiliated systems, Greensboro Imaging uses an Epic EMR system similar to Cone Heath (Greensboro
Imaging website, accessed Dec. 11, 2012).
» » Regional Physicians:
Regional Physicians is the physician subsidiary of High Point Regional Health System. The physician
group, formerly known as MedCentral, is composed of 40 multispecialty physicians and 23 additional
providers who practice in 14 different specialties, including orthopedics, neurology, family medicine,
reproductive medicine, plastic surgery, and occupational health. What began as two practice locations
grew to 19 locations in High Point and surrounding towns. Regional Physicians will be included in High
Point Regional Health System’s merger with UNC Health Care, slated to be finalized in the first quarter of
2013 (Regional Physicians website, accessed Dec. 11, 2012).
» » Central Carolina Surgery:
Central Carolina Surgery has 19 physicians based in its Greensboro practice and serves patients from
central North Carolina to southern Virginia; its members treat patients through Cone Health. In addition
to general surgery, physicians specialize in bariatric, breast, colorectal, thyroid, hemorrhoid, hernia, and
weight-loss surgeries, as well as trauma services (Central Carolina Surgery website, accessed Dec. 11, 2012).
» » Triad Adult and Pediatric Medicine:
Patients of Triad Adult and Pediatric Medicine have access to 15 physicians, five Guilford clinics, and onsite pharmacies. The clinics follow a patient-centered medical home model of coordinated care for primary
and acute care, chronic conditions, nutrition, and behavioral health; the group has a sliding-fee scale for
residents without insurance (Triad Adult and Pediatric Medicine website, accessed Dec. 7, 2012).
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» » Piedmont Ear, Nose & Throat Associates:
Piedmont Ear, Nose & Throat Associates formed in 1999 as a result of the Forsyth Head and Neck Associates/Salem Ear, Nose and Throat Associates merger. The otolaryngology group is composed of nine physicians, six audiologists, and one physician assistant practicing in the Winston-Salem, Kernersville, and
Mount Airy clinical locations. Physicians treat ENT needs, as well as perform plastic facial surgeries, sinus
surgeries, head/neck cancer surgeries, and head/neck endocrine surgeries (Piedmont Ear, Nose & Throat
Associates website, accessed Dec. 11, 2012).
» » Carolina Pediatrics of the Triad, P.A.:
Based in Greensboro, Carolina Pediatrics of the Triad is composed of 11 pediatric physicians who provide primary care to children in the Triad. The group is part of Carolina Pediatrics, which has additional
locations in Wilmington, N.C., and throughout South Carolina (Carolina Pediatrics of the Triad website,
accessed Dec. 13, 2012).
» » Randolph Medical Associates:
Nonprofit Randolph Medical Associates has nine physicians and one dentist on staff, as well as physician
assistants and nurse practitioners. Physicians provide primary care in six offices in Asheboro and the surrounding area (Randolph Medical Associates website, accessed Dec. 7, 2012).
» » Greensboro Medical Associates:
Located solely in Greensboro, Greensboro Medical Associates is a nine-physician practice specializing in
endocrinology, internal medicine, and rheumatology. Additional services include disease and medication
management, consultations, and prescription drug trials. To provide better care to its patients, Greensboro
Medical Associates participates in the Triad HealthCare Network (Greensboro Medical Associates website,
accessed Dec. 10, 2012).
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Health Plans
O
Table 6-1:
Local & State Enrollment
Commercial HMO:
Commercial PPO:
Commercial POS:
Indemnity:
Managed
Medicaid:
Managed
Medicare:
Local
15,829
270,432
163,403
7,181
0
88,522
State
174,181
2,317,386
996,691
66,634
0
303,905
>>>
Sector Outlook
Greensboro’s commercial health plan enrollment increased slightly from 2011 to 2012 as the unemployment and uninsured rates continued to decline. PPO plans still remain the most popular plan design,
while the distribution of fully insured to self-insured lives remained stable, with 42 percent enrollment in
fully insured plans and 58 percent enrolled in self-insured plans. The economy is still in recovery mode,
however, and both residents and employers are examining cost-effective insurance options. As a result,
lower-cost limited-network plans and consumer-driven health plans will continue to attract customers
while health plans promote other cost-effective methods, such as generic drug use.
Highlights:
Blue Cross and Blue Shield of North Carolina dominates the total insured market, followed by national
players UnitedHealth and Cigna. The Blue plan’s 36 percent share is a slight increase over 2011 data.
And though UnitedHealth added member lives in 2012, the health plan’s market share declined to 29
percent. Still in a distant third place, Cigna continued to make strides in attracting member lives and
increased its market share to 11 percent.
Combined, the three largest health plans command 75 percent of the market. The remaining 25 percent of the market is composed of other national health plans with a smaller presence in the region.
Aetna added 11,445 lives when it completed its acquisition of Coventry in May 2013. With the new
Coventry lives, Aetna maintains its status as the fourth-largest health plan in Greensboro, although
its total market share increased to nearly 9 percent.
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» » Prescription drug initiatives:
Local health plans have implemented programs to steer members to generics and other initiatives to
reduce the rising costs of prescription drugs. The Blue plan, UnitedHealth Group, and Cigna each have
a step-therapy program in place, limiting Greensboro physicians’ prescribing power unless the physician specifically requests the branded drug. Health plans also have closed formularies, which further
emphasize generics as cost-saving alternatives to branded drugs (North Carolina Alliance for Health
Communities website, accessed Dec. 20, 2012). Coupled with the increasing regional attention to cost
savings and quality initiatives, generic prescription rates are expected to rise in the coming years.
» » Narrow networks:
Cost is a big concern for residents and local employers, and health plans are jumping at the chance to
increase enrollment while lowering costs. Beginning in January 2013, BCBS of North Carolina began
offering new lower-cost plans with limited provider networks for individuals and employers, in addition to several low-cost options already available (Blue Cross and Blue Shield website, accessed Dec. 20,
2012). UnitedHealth Group already offers low-cost plan designs to employers, which feature limited
formularies and tiered provider networks (UnitedHealth Group website, accessed Dec. 20, 2012). Such
options will give these insurers a competitive edge in 2013.
High Point Regional Health System and Randolph Hospital were selected to be part of Coventry
Health Care of the Carolinas’ narrow-network plan design known as Carelink, which also includes
independent physician group Cornerstone Health Care. Announced in October 2012, Carelink will
be offered to employees in the Triad, and the health plan offers a 10 percent premium reduction incentive for using the inpatient services offered in High Point Regional and Randolph Hospital and the
outpatient care services offered through Cornerstone. Employees will be able to see other providers in
Coventry’s network but will not benefit from the 10 percent premium reduction.
» » Health insurance exchange:
Former Gov. Bev Perdue announced on Nov. 15, 2012, that the state would pursue a federal-state
health insurance exchange. This was to give the state the option to implement plan management functions, consumer assistance functions, or a combination of both (Kaiser Family Foundation website,
accessed Nov. 20, 2012). However, new Gov. Pat McCrory signed into law the General Assembly’s No
N.C. Exchange/No Medicaid Expansion (HB 16/SB 4), forbidding a federal-state partnership. North
Carolina was added to the list of states defaulting to the federal government to run the state’s insurance marketplace.
North Carolina proposed the Blue Options PPO plan offered by BCBS of North Carolina as its benchmark plan. While the plan covers supplemental pediatric oral and vision care, Blue Options PPO
covers neither weight-loss programs nor long-term care in skilled nursing facilities. North Carolina’s
benchmark plan is also considered to be one of the least generous prescription drug plan benefits in
the nation, with a limited 485 drugs on its proposed formulary (Centers for Medicare & Medicaid Services). Determinations about essential health benefits will apply to both individual and small-group
policies—within and outside the insurance exchange—beginning in 2014.
» » Legislation:
The North Carolina State Senate introduced legislation during its 2012 short session that would have
required health plans to remove language from their contracts that forbid health systems and hospitals
from negotiating lower rates with other health plans (SB 517). The legislation did not pass, but it gained
a supporter in the state’s Blue plan, which chose to voluntarily remove any language from its contracts
forbidding such negotiations and will notify its contracted providers of the change (Employers Coalition of North Carolina website, accessed Dec. 12, 2012).
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» » Pay-for-performance programs:
The three largest health insurers in the Triad have developed pay-for-performance initiatives,
prompting local healthcare providers to adjust their own pay methods to better align with the recent
reimbursement trend. UnitedHealthcare implemented a pay-for-performance bonus for contracted
physicians in 2012 (UnitedHealthcare website, accessed Dec. 19, 2012).
BCBS of North Carolina has an established pay-for-performance initiative known as Blue Quality
Physician Program, for which the state’s primary-care physicians can apply. BQPP-designated groups
must use electronic prescribing methods and provide after-hours care. The primary qualification for
physicians to participate in the program is to have NCQA-recognition as a patient-centered medical
home (Blue Cross and Blue Shield of North Carolina website, accessed Dec. 21, 2012).
Health plans with a smaller market share are also implementing pay-for-performance measures.
Cigna compensates participating physicians on a pay-for-performance basis as part of its collaborative
ACO project (Cigna website, accessed Dec. 20, 2012). Local physician group Cornerstone Health Care,
a member of the Cigna ACO initiative, is reimbursed for meeting quality initiatives outlined by the
ACO. In response, the physician group began paying its physicians on a pay-for-performance model.
Aetna, which has a smaller presence in the market, renegotiated its contract with second-largest health
system Novant in 2012. Part of the new contract stipulates that providers will be reimbursed on a payfor-performance model.
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Blue Cross and Blue Shield of North Carolina
Table 6-3:
Commercial Enrollment
>>>
Local
Statewide
Fully Insured
HMO:
Self-Insured
HMO:
Fully Insured
PPO:
Self-Insured
PPO:
Fully Insured
POS:
Self-Insured
POS:
Indemnity:
908
673
106,763
56,876
0
0
480
2,283
11,129
922,030
403,156
0
0
5,444
Table 6-4:
Government-Sponsored Enrollment
Managed Medicaid:
Medicare HMO:
Medicare PPO:
Medicare PFFS:
Other Medicare:
Local
0
30,772
1,991
0
0
Statewide
0
74,527
11,918
0
0
>>>
Headquartered in Chapel Hill, nonprofit Blue Cross and Blue Shield of North Carolina holds more
than a third of Greensboro’s insured market, including more than half of the PPO market. Although
the Blue plan has a small presence in commercial HMO plans, it has the second-largest HMO enrollment in the Triad based on the strength of its Medicare HMO (HealthLeaders-InterStudy data).
BCBS of North Carolina’s renegotiated contract with the state of North Carolina will take effect July
1, 2013, continuing a 25-year partnership. The state selected the Blue plan over UnitedHealthcare.
Employees can choose from different plans, including Blue Options, North Carolina state employees’
PPO plan, and BlueCard, which allows enrollees to see out-of-town, in-network providers for the same
cost as local, in-network providers. Free, additional benefits are offered through The BlueExtras and
Blue365 (North Carolina State Health Plan website, accessed Nov. 19, 2012).
Beginning Jan. 1, 2013, employees and individuals will be able to choose new, low-cost plans offered
by BCBS of North Carolina: Blue Select and Blue Value. The Blue Select PPO plan, available only to
employees, places in-network providers in tiers, with an expected 10 percent savings; Tier 1 providers
require lower copays than those in Tier 2 and are considered to offer better quality at a lower cost. Blue
Value, already available to employers, will be available for individual purchase as a point-of-service
plan design, which features a limited provider network with savings of up to 15 percent compared
with traditional PPOs. Both plans have limited formularies to further reduce healthcare costs (BCBS
of North Carolina website, accessed Dec. 13, 2012).
The carrier partnered with independent physician group Cornerstone Health Care to form an ACO
for chronically ill patients in the Triad. Cornerstone care navigators coordinate patient care and medication therapy, and both entities will share patient data. Through its ACO formation, BCBS of North
Carolina formed a value-based contract with Cornerstone Health, transitioning away from the typical
fee-for-service payment model (BCBS of North Carolina press release).
The Blue plan has also announced that it will implement SAS Membership Portfolio Optimization
from SAS Center for Health Analytics and Insights. The program helps customize and personalize
health insurance for consumers. CHAI and BCBS of North Carolina are working together to help the
health plan better identify and understand health insurance needs of current and potential members
while keeping costs low.
The local Blue plan partners with North Carolina hospitals to provide claims assistance to individuals
while they are still in the hospital. Wake Forest Baptist Medical Center is the first in the region to have
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BCBS of North Carolina’s staff on-site to assist patients. The program began in 2009 at WakeMed, and
BCBS staff members have more than 70 percent of claims settled within two days of when the claim is
received by the patient (BCBS of North Carolina website, accessed Nov. 19, 2012).
In October 2012, BCBS of North Carolina announced that it had struck a deal with Walgreens and
American Well to create a telehealth program to enable BCBS employees and dependents to access
healthcare coaches, nurse practitioners, and nutritionists. Participating providers have access to the
individual’s medical record through technology developed and implemented by Walgreens’ Take Care
system (OnSite Clinics website, accessed Nov. 27, 2012).
The Blue plan assists with the North Carolina Program to Advance Technology for Health, implemented by the North Carolina Health Information Exchange. The collaboration among the Blue plan,
NC HIE, and Allscripts for NC PATH is to improve quality and lower costs in the state by implementing health information technology-compliant initiatives for state healthcare organizations (North
Carolina Health Information E website, accessed Dec. 7, 2012).
BCBS of North Carolina had a consolidated net income of $177.1 million in 2011, an increase from
2010’s consolidated net income of $167.7 million. The company’s overall 2011 revenue was $5.5 billion
(BCBS of North Carolina website, accessed Nov. 19, 2012).
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UnitedHealth Group
Table 6-5:
>>>
Local
Statewide
Fully Insured
HMO:
Self-Insured
HMO:
Fully Insured
PPO:
Self-Insured
PPO:
Fully Insured
POS:
Self-Insured
POS:
Indemnity:
4,496
2
3,296
2,903
28,167
71,977
3,622
19,154
22
25,740
25,226
143,810
366,596
28,383
Table 6-6:
Managed Medicaid:
Medicare HMO:
Medicare PPO:
Medicare PFFS:
Other Medicare:
Local
0
39,936
3,638
0
0
Statewide
0
89,740
8,339
6,051
0
>>>
UnitedHealth Group is the second-largest insurer in Greensboro, with a share of nearly one-third of the
insured market. The health plan has the largest HMO enrollment owing to its high Medicare HMO enrollment. The health plan also has a large portion of its members in POS plans, the majority of whom are in
self-insured plans (HealthLeaders-InterStudy data).
In August 2012, UnitedHealthcare, a division of UnitedHealth Group, lost its bid to be North Carolina’s
third-party claims administer for state employees when the state re-awarded the contract to BCBS of North
Carolina. However, UnitedHealthcare was awarded the Medicare Advantage Fully Insured Plan contract
alongside Humana, which has the third-largest managed Medicare enrollment in the Triad.
UnitedHealthcare and its Optum subsidiary announced a partnership with Cornerstone Health Care in
January 2013. Cornerstone providers, who will be reimbursement on a pay-for-performance model, will
have access to Optum’s technology to access patient data to outline the best treatment course. UnitedHealth formed the Accountable Care Solutions operation within its OptumHealth subsidiary in late 2011,
in an effort to help physician practices, hospitals and carriers nationwide design and build the complex IT,
clinical, reporting, management and financial structures required to set up a functional ACO.
UnitedHealth is looking to expand its presence internationally. The health plan will purchase 90 percent
of Brazilian-based Amil Participacoes for $5 billion. Amil is the largest healthcare company in Brazil,
offering health insurance and hospital/clinic care services for approximately 5 million individuals. With
this acquisition, UnitedHealth will have the ability to provide health insurance and healthcare, following
a growing trend of fully integrated health systems in America (UnitedHealth Group website, accessed Oct.
26, 2012).
The Minnetonka, Minn.-based UnitedHealth Group reported net earnings of $5.14 billion for calendar
year 2011, up from $4.63 billion in 2010. Revenues were $101.86 billion, up from $94.16 billion in 2010, while
the operating margin was 8.3 percent, down slightly from 8.4 percent the previous year. At year-end 2011,
the company had 39.4 million medical members (including stand-alone Medicare Part D enrollment), a 5
percent increase from 37.5 million medical members in 2010.
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Cigna
Table 6-7:
Fully Insured
HMO:
Self-Insured
HMO:
Fully Insured
PPO:
Self-Insured
PPO:
Fully Insured
POS:
Self-Insured
POS:
Indemnity:
Local
2,714
0
1,617
5,579
4,388
46,986
546
Statewide
5,893
0
11,188
37,054
30,611
318,009
6,007
>>>
Table 6-8:
Managed Medicaid:
Medicare HMO:
Medicare PPO:
Medicare PFFS:
Other Medicare:
Local
0
0
0
0
0
Statewide
0
0
0
0
0
>>>
Third-largest Greensboro insurer Cigna accounts for 11 percent of total enrollment in Greensboro, with all
of its insured lives in commercial products. The largest share of Cigna’s enrollment is in self-insured POS
products (HealthLeaders-InterStudy data).
As part of its collaborative ACO initiative, Cigna announced in April 2012 that it had formed partnerships
with 22 physician organizations from seven states, including High Point-based Cornerstone Health Care,
an independent physician organization of 357 physicians. The ACO, known as Cornerstone Health Care,
P.A., has 313 participating Cornerstone physicians who treat 5,000 of Cigna’s insured lives in the market;
physicians are reimbursed for meeting goals of improved and lowered cost of care.
Cigna also formed a collaborative ACO with second-largest health system Novant Health in April 2013.
The Novant CAC is Cigna’s largest and will serve approximately 60,000 residents in the Carolinas who are
Cigna members and use Novant facilities. Building on Novant’s PCMH model of care, the health systems’
care coordinators will work with case managers for patient care. Through its partnership with the multistate health system, Cigna could be working to improve its position in the market and statewide.
In September 2012, the National Committee for Quality Assurance named Cigna’s HMO, POS, and PPO
plans top-ranking plan designs in North Carolina, the sixth consecutive year that the provider’s HMO
and POS plans were top-ranking in the state. Nationally, Cigna of North Carolina ranked 103 out of 538
private health plans, according to NCQA; the parent company ranked 120 out of 538 private health plans.
NCQA ranks health plans based on performance in quality improvement, customer service response, and
NCQA accreditation survey scores.
Parent company Cigna Corp. reported unaudited adjusted income from operations of $1.43 billion in 2011,
up from $1.28 billion in 2010, and total revenues of $22.00 billion in 2011, up from $21.25 billion the year
before. Total medical membership was 12.7 million lives (including 1.2 million expatriate and international
lives) at year-end 2011.
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Table 6-9:
Health Plans and Pharmacy
Health Plan
2-tier Design%
3-tier Design%
4-tier Design%
Rx Generic
Copay
Rx Preferred
Brand Copay
Rx Nonpreferred Brand
Copay
N/A
N/A
100%
$10.00
$30.00
$45.00
UnitedHealth Group (UnitedHealthcare)
<1%
90%
9%
$10.00
$35.00
$60.00
7%
82%
11%
$7.81
$29.25
$44.92
Cigna
Source: HealthLeaders-InterStudy, July 2012 Pharmacy Benefit Evaluator. Tier design is national company data for all Rx benefits; copay data is for the most typical plan offering.
Table 6-10:
Health Plans and Pharmacy Management
PBM Provides Formularies or
Formulary Consultation?
Health Plan
PBM(s)
Prime Therapeutics Inc. (retail,
No
mail order, specialty)
Medco Health (retail, mail
order)
PBM Provides Consultations
on Benefit Design?
Yes
No
No
No
N/A
OptumRx (specialty)
Argus (retail, mail order,
specialty)
Cigna
Source: HealthLeaders-InterStudy, July 2012 Pharmacy Benefit Evaluator. National company data.
Table 6-11:
Health Plans and Generics
Percent Spent
on Generics Percent Spent on Preferred Brands
Health Plan
Percent Spent
on Nonpreferred Brands
27%
30%
43%
21%
49%
30%
Cigna
24%
59%
17%
Source: HealthLeaders-InterStudy, July 2012 Pharmacy Benefit Evaluator. National company data for all Rx benefits.
Note: For more information about health plans and pharmacy benefits, please contact HealthLeadersInterStudy about purchasing access to the Pharmacy Benefit Evaluator. Additional coverage includes indicators of commercial, Medicaid and Medicare business opportunity; indicators of branded drug coverage;
indicators of access to biological drugs; drug expenditures by therapeutic class; and indicators of plans’
ability to control Rx benefit.
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Medicaid/Medicare/
Uninsured
Table 7-1:
Medicaid
Total
Beneficiaries:
Percent of
Population:
MCO-Managed
Title 19 Medicaid:
MCO-Managed
CHIP:
Other MCO-Managed Medicaid:
Total MCO-Managed
Medicaid:
Local
212,930
18%
0
0
0
0%
State
1,712,042
18%
0
0
0
0%
>>>
Gov. Pat McCrory chose not to expand Medicaid in North Carolina after researching the pros and cons
of adding 500,000 beneficiaries. The state’s House and Senate Republicans passed legislation barring the
state from expanding Medicaid, and McCrory signed the bill into law in February 2013. Democrats and
healthcare industry insiders pushed for an expansion. Gov. McCrory argues that given the current state of
the program, an expansion is not in the best interest of the state. It is estimated the 2013 Medicaid shortfall
would be $248 million, up $135 million from previous estimates.
Instead, Gov. McCrory and the state’s Department of Health and Human Services propose to reform
Medicaid in their plan dubbed “Partnership for Healthy North Carolina.” The plan entails a single entry
point into the state’s Medicaid system, and network providers will focus on employing comprehensive,
coordinated care for beneficiaries. Three Comprehensive Care Entities would be established to build or
partner with existing providers or networks to coordinate physical and behavioral healthcare for Medicaid
recipients (North Carolina Department of Health and Human Services website, accessed June 7, 2013).
Criticisms of the existing program include that administration and IT are duplicative, and that physical,
mental, and even substance abuse services are heavily siloed for members.
North Carolina has moved forward on several other options outlined by the Affordable Care Act. In
May 2012, the U.S. Department of Health and Human Services announced North Carolina Community
Networks, a statewide ACO for 50,000 children who are Medicaid and CHIP beneficiaries with chronic
conditions, as one of its Innovation Award winners. Care coordinators work in-home with patients and
parents to better understand care management and help cover the state’s shortage of pediatric primary-care
providers and specialists. Local health systems Wake Forest Baptist Health and Cone Health are participants in the initiative (HHS Innovation Awards website, accessed Dec. 11, 2012).
North Carolina is also one of 15 states that received $1 million from the Centers for Medicare & Medicaid Services to integrate care for residents dually eligible for both Medicaid and Medicare. The state will
expand its existing Community Care of North Carolina program, a public-private program, to improve
health and provide better-quality care at a lower cost for 284,000 dually eligible state residents. CCNC
provides care to Medicare and Medicaid beneficiaries through regional provider networks (CMS).
The state of North Carolina operates a public/private medical home model for Medicaid enrollees called
Community Care of North Carolina, a collaborative effort between the state and 14 nonprofit, community
care networks that manage medical services for Medicaid and Health Check beneficiaries. Local providers
in the program include hospitals, primary-care physicians, and county health and social services departments, among other stakeholders. CCNC saved nearly $1.5 billion in Medicaid spending from 2007 to
2009, according to a June 2011 analysis from Treo Solutions, a healthcare analytics consultant. North Caro-
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lina has implemented pay-for-performance and training payment incentives for providers that participate
in Medicaid medical home programs (Health Affairs, November 2012).
Health Check is the state’s Children’s Health Insurance Program. NC Health Choice covers children of
working families who do not qualify for Health Check but who may not be able to afford private insurance.
For a child to qualify, a family’s monthly income must not exceed 200 percent of the federal poverty level.
North Carolina’s Medicaid program is taking a very active role in moving members to generics and lowcost alternatives to branded drugs. The CCNC’s Pharmacy Home Project provides medication management and coordination tools to pharmacists, nurses, and other allied health professionals who are involved
in the CCNC’s pharmacy projects and initiatives. Pharmacy Home serves as a virtual databank of druguse information from multiple sources and is being used to inform prescribing and intervention strategies. Pharmacists who are in the CCNC network use special Internet-based software to exchange patient
information among case managers, physicians, and pharmacists within the community. The Pharmacy
Home Project has three criteria for patient enrollment, which includes taking at least 24 drugs within three
months and having visited more than three medical practices in six months. Patients must be referred to
the Pharmacy Home by prescribers, case managers, or network pharmacists.
Table 7-2:
Medicare
Total
Beneficiaries:
Percent of
Population:
Medicare HMO:
Medicare PPO:
Local Medicare
206,778
17%
75,881
11,153
State Medicare
1,595,888
17%
181,536
79,645
>>>
Medicare PFFS:
Other Managed
Medicare:
Total MCOManaged
Medicare:
1,410
78
43%
42,198
526
19%
Table 7-3:
Prescription Drug Plan
MA-PDP:
Stand-alone PDP:
Total PDP Penetration:
Local PDP
83,138
62,844
71%
State PDP
270,460
703,949
61%
>>>
North Carolina is a single region for stand-alone Medicare Part D drug plans and joins with Virginia to
form a single region for Medicare Advantage plans with an attached prescription drug benefit.
UnitedHealth Group is the largest provider of managed Medicare in the Greensboro region, followed by Blue
Cross and Blue Shield of North Carolina and Humana. Though it continued to be the leading provider of
managed Medicare, UnitedHealth’s share decreased by 4 percentage points in the year ended July 2012, while
the Blue plan noted a 3 percentage-point gain. Humana’s share remained steady (HealthLeaders-InterStudy).
UnitedHealthcare began requiring prior authorization for select specialty drugs prescribed by physicians
in North Carolina on April 2, 2012. This requirement excludes specialty drugs for services that take place in
an emergency room, observation unit, urgent-care facility, or during an inpatient stay (UnitedHealthcare
website, accessed Nov. 19, 2012).
The Community Care of North Carolina program for low-income Medicaid patients became available to
low-income, dual-eligible Medicare patients and some Medicare-only enrollees in January 2010 through
a CMS pilot project. The pilot is part of the national, five-year Medicare Health Care Quality program
mandated by Congress. The project runs through May 2014 and is intended to improve what CMS officials
say is a fragmented system of care for dually eligible individuals in places such as North Carolina, where
primary care for Medicaid beneficiaries is coordinated but does not extend to Medicare recipients. The
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new Medicare project uses a physician-directed care management approach combined with information
technology applications designed to support care coordination and evidence-based medicine. The project
operates in 26 of the state’s 100 counties. At least half of any shared-savings payments to physicians are
contingent upon achieving targets on a set of performance measures, including those for diabetes, heart
failure, and transitional care.
Table 7-4:
Uninsured
Uninsured:
Percent of Population:
Local
203,926
17%
State
1,626,628
17%
48,873,523
15%
>>>
National
Though North Carolina’s uninsured rate is above the national average, the rate has fallen since 2009, when
approximately 20 percent of North Carolina residents were uninsured owing to the 2008 economic downturn (North Carolina Health News).
Triad Adult & Pediatric Medicine Inc. is the federally qualified health center name for HealthServe’s six
clinics in Greensboro and High Point: two HealthServe sites, the High Point Regional Adult Health Center,
and three sites operated by Guilford Child Health. FQHC-designated clinics provide primary care and case
management to low-income patients through a patient-centered medical home model (North Carolina
Community Health Association website, accessed Dec. 19, 2012).
North Carolina operates a preexisting condition insurance plan, which is run by the North Carolina
Health Insurance Risk Pool (named Inclusive Health). Monthly premiums vary by region, ranging from
$69 to $658. The plan covers primary, specialty, and hospital care and prescription drugs. Individuals can
choose from four plans, which tier deductibles; Plan 4 is a high-deductible health plan with a health savings
account (Healthcare.gov website, accessed Nov. 19, 2012).
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Pharmacy
–
THIS SECTOR IS: NEGATIVE
A transformation is occurring in the Greensboro market, with healthcare providers actively implementing
and participating in innovative programs designed to improve residents’ health while lowering costs. As
providers work with patients to better manage diseases, they will also focus on ensuring that patients follow
prescribed medication therapies, through which the Greensboro pharmacy sector will see an increase in
medication adherence and drug-fill persistence rates, particularly for generics. Further negatively affecting
the pharmacy sector is the increased interest in consumer-driven health plans and the addition of low-cost
plans. Both of these cost initiatives could continue to gain popularity and momentum, driving patients and
prescribers to generics and low-cost options.
As of July 1, 2012, Medicare Advantage PDP and stand-alone PDP enrollees combined for a market penetration of 71 percent in the Greensboro market, versus 64 percent nationwide (HealthLeaders-InterStudy).
Factors that are unfavorable to pharmaceutical sales include the following:
»» N
orth Carolina has poor medication adherence and has an average generic prescribing rate, and it
was given the lowest rating, bronze, for medication adherence. One disease state with high generic
dispensing is hypertension, with 84 percent fill rate, although this is lower than the national average
(CVS Caremark Medication Adherence Interactive State Rankings, accessed Nov. 30, 2012).
»» W
ake Forest University School of Medicine received a B for its conflict-of-interest policies relating to
pharma from the American Medical Student Association. Wake Forest does not allow pharmaceutical
reps on campus without a prior appointment, nor are physicians permitted to receive drug samples,
but its on-site pharmacy can accept drug samples (American Medical Student Association website,
accessed Nov. 29, 2012).
»» T
he top health plan in the Triad—Blue Cross and Blue Shield of North Carolina—lowered its commercial per-member, per-month drug spending from 2010 to 2011. In 2010, BCBS of North Carolina
spent $52 PMPM, but its 2011 spending decreased to $48 PMPM. (HealthLeaders-InterStudy data).
»» G
reensboro’s top three insurers each emphasize the importance of generics through programs such
as step therapy and prior authorization. Blue Select and Blue Value, introduced by BCBS of North
Carolina on Jan. 1, 2013, are low-cost alternatives that have limited formularies and limited networks.
»» N
orth Carolina’s proposed BCBS of North Carolina’s Blue Options PPO as the benchmark for essential health benefits may dampen prescription drug sales when the health insurance exchange comes
online in 2014. With a limited 485 drugs on its proposed formulary, the PPO is considered to be one
of the least generous prescription drug plans in the country.
»» G
reensboro’s top health plans have the majority of members in three- and four-tier formularies,
which require the highest out-of-pocket spending for nonpreferrred branded drugs (HealthLeadersInterStudy data).
»» T
riad residents are actively enrolling in consumer-driven health plans, which pair high-deductible
plans with health savings accounts and health reimbursement arrangements. Approximately 16
percent of commercial enrollees in the market enrolled in such plans as of July 2012 (HealthLeadersInterStudy data).
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»» A
pproximately 9.8 prescriptions were filled per capita in North Carolina in 2011, versus the national
average of 12.1, ranking the state 47th in the nation for the measure (analysis of data by the Kaiser
Family Foundation).
Factors that are favorable to pharmaceutical sales include the following:
»» A
lthough the North Carolina Blue plan has a heavy emphasis on generics, it also encourages patientphysician communication about available treatment options.
»» N
orth Carolina’s Medication Assistance Program helps the uninsured apply to pharmaceutical companies for needed prescription drugs. Approximately $1.7 million dollars in state funding supported
the program in 2011, but the funds were cut from the proposed 2013 Senate budget. However, the
House and Gov. Perdue supported the inclusion of the funding, which assisted uninsured with annual
access to $100 million in prescription drugs (North Carolina Health News, accessed Nov. 20, 2012).
»» P
roctor & Gamble and Marriott International have value-based insurance designs for employees
with asthma, chronic renal failure, diabetes, depression, congestive heart failure, coronary artery
disease, hypertension, obesity, and tobacco abuse disorder. Such programs lower employee cost shares
to increase access to needed care (V-BID website, accessed Nov. 21, 2012). For more detail, see the
Employers section of this report.
»» C
ompared to the national average, the Greensboro market has a surplus of office-based primary-care
and specialty physicians, indicating that local residents have better-than-average access to prescribers. Greensboro has approximately 71 primary-care physicians per 100,000 residents, compared with
64 physicians nationally, and 125 specialists per 100,000 compared with 114 for the national average
(SK&A Information Services Inc., 2012).
»» G
reensboro is a promising area for market expansion in the treatment of asthma, chronic obstructive pulmonary disease, hepatitis C, multiple sclerosis, and psoriasis, based on estimates that show
relatively high percentages of untreated patients and residents with prescription drug benefits in 2011
(Decision Resources’ PatientFinder database).
»» N
orth Carolina ranks 33rd in America in overall health in 2012, up from 35th in 2011. The challenges
North Carolina faces are low per-capita funding for public health, a high percentage of children living in poverty, and a high rate of infant mortality (United Health Foundation’s America’s Health
Rankings 2012).
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Legislation
North Carolina’s new biennium legislative session began Jan. 30, 2013, and is the first of two regular sessions taking place in 2013 and 2014. The General Assembly is composed of 120 House of Representative
and 50 Senate seats, with a Republican majority (North Carolina General Assembly website, accessed Nov.
15, 2012). The state also elected Republican Gov. Pat McCrory, making it easier to pass GOP-supported
legislation. North Carolina has not had a Republican governor in two decades (Greenville Online).
One of the first issues Gov. McCrory and the General Assembly tackled in 2013 was decreasing the state’s
$2.5 billion debt to the federal government and decreasing unemployment benefits. Under HB 4/SB 6,
which had bipartisan support and was signed into law by Gov. McCrory, weekly unemployment benefits
decrease to $350 a week, and the maximum length of time to receive benefits was reduced to 20 weeks from
the prior 26-week benefit period. The adjustments will pay down the federal debt by the end of 2015 and
put $2 billion in reserve by the end of the decade (News Observer).
Table 9-1:
Summary of Recent Legislation
Bill Name and Number
Description
Status and Date
No N.C. Exchange/No Medicaid
Expansion (HB 16/SB 4)
Prevents the state from participating in the optional Medicaid expansion; rejects
any attempt to set up a state insurance exchange; rejects any federal funding associated with the Affordable Care Act
Signed by governor
February 2013
North Carolina Health Plan (HB
70)
Would extend the North Carolina Health Plan to insure all North Carolinians as an
alternative to the state’s health insurance marketplace
In committee
February 2013
HealthCare Cost Reduction &
Transparency (SB 473)
Would require hospitals and ambulatory-surgery centers to reveal prices of most
common surgeries performed; would provide financial rewards to those offering
low-cost treatments; would ban radiology double-billing
In committee
April 2013
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Employers
+
THIS SECTOR IS: POSITIVE
Sector Outlook
Economic recovery in Greensboro continues to be a slow but steady process. Facing increases in healthcare
costs and premiums, employers are examining ways to continue offering health insurance to employees
while managing costs. Some employers are opting to implement wellness programs and on-site clinics for
employees, while others continue with value-based insurance designs. Local health plans are catering to
the cost-conscious employer with new offerings, including narrow-network products offered by Blue Cross
and Blue Shield of North Carolina and Coventry Health Care, which has been acquired by Aetna. An estimated 16 percent of residents covered by employer-sponsored and individual health policies in Greensboro
are in consumer-driven health plans, and deductible levels have skyrocketed as employers try to keep costs
in check. We predict these dynamics will fuel unprecedented competition among health plans, as well as
innovation, as local businesses look to tailor insurance products to their employee populations.
Highlights:
» » Economy:
The unemployment rate in the Greensboro market was 10 percent in August 2012, compared with 11
percent in August 2011. The national unemployment rate was 8 percent in August 2012 (Bureau of
Labor Statistics). Though Greensboro continues to follow the North Carolina trend of higher-thanaverage unemployment rates, both the region and the state have experienced declining unemployment
over the past year.
The Triad market is home to four Fortune 500 companies: BB&T Corp., VF, Reynolds American, and
Laboratory Corp. of America. The region’s largest employment segments overall are trade, transportation, and utilities; government; and education and health services (BLS).
In recent years, North Carolina has faced stiff competition from South Carolina in securing business
contracts and corporations. For the most part, South Carolina has landed the companies, believed
to result from S.C. Gov. Nikki Haley’s pro-business stance. During his first year in office, Gov. Pat
McCrory will focus on expediting the state’s economic recovery. He is determined to bring in new
business and increase employment by improving business relationships with the state, as well as
decrease the unemployment level below South Carolina’s unemployment rate during his first year in
office (Greenville Online).
In December 2012, former Gov. Bev Perdue announced that health supplement manufacturer Herbalife would be locating a new $300 million manufacturing and distribution operation to WinstonSalem, creating 493 new jobs in the Triad.
» » Plan design/premiums:
The NC Department of Insurance reviews insurers’ requested rate increases for the coming year. For
Blue Cross and Blue Shield of North Carolina, the state and Triad’s largest insurer, a premium increase
was approved in November 2012 that resulted in an 8.1 percent average increase for Blue Advantage
PPO members. HSA enrollees will notice a 9.9 percent increase in premiums in 2013. These increases
are on trend with other health plan premium increases in the region. While premiums are expected
to rise in the next 12 to 18 months, the exact percentage is unknown because health plans are waiting
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for rules and regulations to be finalized. A local broker source estimates that small-group insurance
premiums will increase on average 40 percent, while larger, fully insured groups could experience a
20 percent to 30 percent hike in premiums.
As discussed in the Health Plans section of this report, in January 2013 BCBS of North Carolina began
offering lower-cost plans with limited provider networks. Coventry Health Care of the Carolinas
announced the availability of Carelink, a narrow-network plan, in October 2012, which allows members
the option of a 10 percent reduction in premiums if they use preferred providers High Point Regional
Health System, Randolph Hospital, and independent physician group Cornerstone Health Care.
» » On-site clinics/wellness initiatives:
Local employers are offering their workers a variety of wellness and on-site clinic opportunities in an
effort to control increasing health insurance premiums. Inmar Inc., which employs 650 in the Triad,
launched its wellness program in 2007 to combat its rising heath premium costs. Wellness programs
offered to employees includes smoking cessation and nutrition classes, an on-site farmers’ market,
walking meetings, and discounted gym memberships. The company reports that the program led to
lower medical utilization and fewer days of productivity lost to illness. Acme-McCrary Corp., a clothing manufacturing company based in Asheboro and Siler City with 600 employees, has expanded
its wellness program to include the following on-site health initiatives: on-site health clinic, disease
management provided by a staffed nurse practitioner, and annual mammogram screening from a
mobile unit (The Business Journal).
» » Value-based insurance design:
With value-based insurance design, employers reduce access barriers for medical services and prescription drugs that help employees stay healthy and keep chronic disease at bay. Two Greensboro
self-insured employers, Marriott International and Proctor & Gamble, participate in the University
of Michigan’s V-BID program.
Marriott requires no cost sharing of its employees for statins, inhaled corticosteroids, ACE inhibitors
and angiotensin receptor blockers, beta blockers and diabetes medications, all of which are Tier 1
drugs; the company subsidizes 50 percent of some Tier 2 and Tier 3 drugs.
Proctor & Gamble prescription drug tiers require 30 percent coinsurance for Tier 1 drugs, which are
deemed those most essential to “preserve life of major body system functions;” 50 percent coinsurance
for Tier 2 drugs, which are considered “nice-to-haves;” and 100 percent coinsurance for Tier 3 drugs,
which include appetite suppressants or hair-growth products. P&G also offers incentives of $80 for
completion of weight-loss or smoking-cessation programs and $160 for employees with chronic conditions who complete a personalized disease management program (V-BID website, accessed Nov. 21,
2012). Proctor & Gamble employs 1,000 residents in the Greensboro market, and Marriott employs
more than 400 (HealthLeaders-InterStudy, 2012 Employer Vantage data).
» » Consumer-driven health plans:
There were 73,545 covered lives in consumer-driven health plans in Greensboro as of July 1, 2012,
accounting for an estimated 16 percent of commercial enrollees (HealthLeaders-InterStudy data).
CDHPs pair high-deductible health plans with health savings accounts or health reimbursement
arrangements. The average deductible for family coverage in North Carolina was $2,756 in 2011,
which was higher than the national average deductible for families of $2,220, but which had more than
doubled (The Commonwealth Fund, December 2012).
» » State employee program:
Beginning Jan. 1, 2013, retired Medicare-eligible state employees and dependents of state employees
will be automatically enrolled in Express Scripts Medicare Prescription Drug Plan. The new prescription drug plan has a $2,500 maximum out-of-pocket expense or a yearly expense of $2,970 for pre-
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scription drugs. Beneficiaries receive additional coverage from the State Health Plan, which prevents
the coverage gap that arises after enrollees have reached their maximum out-of-pocket expenses but
before they are eligible for Catastrophic Coverage. State employees and dependents must fill prescriptions at in-network pharmacies, either in a retail setting or through the mail. Beneficiaries can
participate in complimentary medication management programs through the new plan design (State
Health Plan North Carolina website, accessed Dec. 12, 2012).
» » Self-insurance:
North Carolina has a higher rate of employees in self-insured plans than the national average. As of
2011, 65 percent of private-sector members were enrolled in self-insured plans at companies sponsoring health insurance, versus the national average enrollment of 59 percent. Among organizations with
fewer than 50 employees, 5 percent of privately enrolled members were in self-insured plans, compared with 11 percent nationwide, and among organizations with 50 or more employees, 76 percent
of privately enrolled members were in self-insured plans, versus 69 percent nationwide (Agency for
Healthcare Research and Quality).
Business Coalitions
The North Carolina Business Group on Health provides a forum for state employers to collaborate on and
influence policies for better healthcare costs and quality through three mediums: advocate, innovate, and
educate. The Charlotte-based group represents self-insured and fully insured businesses throughout North
Carolina and was modeled after the successful Rhode Island Business Group on Health and Connecticut
Business Group on Health (North Carolina Business Group on Health website, accessed Dec. 12, 2012).
Based in Charlotte, The Employers Association is a membership group of approximately 900 organizations
that provides human resource services, including advice, research, information, and training. The group
serves public and private organizations of all sizes and industries. TEA’s partnership with healthcare firms
provides member access to preventive healthcare benefits insurance, health savings accounts, on-site wellness initiatives, and vision benefits. Through its partnership with Group Benefit Solutions, TEA members
can speak with representatives to design health insurance packages specific to the employer’s needs (The
Employers Association website, accessed Dec. 12, 2012).
Employers Coalition of North Carolina formed through a partnership of three employer associations and
their 2,500 members in the state: Capital Associated Industries, the Employers Association, and Western
Carolina Industries in Asheville. The coalition is the lobbying arm of the business community in the region
and was instrumental in passing the state Senate’s unemployment reform legislation (Employers Coalition
of North Carolina website, accessed Dec. 12, 2012).
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Demographics & Statistics
Table 11-1:
Greensboro, NC Demographics & Statistics
July 2012
% Change
Population
1,212,991
0.9%
# of HMOs
15
July 2012
Managed Care Market
July 2012
Total HMO Enrollment
91,710
HMO Penetration %
7.6%
23.6%
Medicare %
42.8%
27.2%
Medicaid %
0.0%
58.4%
National Avg.
Physician Supply (2012)*
Physicians/100K Population
Number
% of Total
Regional
National
857
36.1%
70.7
64.0
Specialists
1,515
63.9%
124.9
113.8
Total Patient-Care Physicians
2,372
100.0%
195.5
177.8
Primary-Care Physicians
Hospitals**
2012
2012 National Avg.
Number of Hospitals
15
N/A
Acute-Care Beds per 1,000 Pop.
2.9
1.6
58.7%
60.7%
5.3
4.7
Inpatient Occupancy Rate
Average Length of Stay (Days)
Note: HealthLeaders-InterStudy relies on third parties to assemble some of the data above. Variations in these firms’ methods may introduce inconsistencies when comparing their data.
*Office-based physicians only.
**Calculations exclude the following hospital types: federal, state, psychiatric only, rehab only, nursing home, skilled nursing facility care, and longterm acute care.
Sources: HealthLeaders-InterStudy; based on data from Billian’s HealthDATA; SK&A Information Services Inc.
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Greensboro - One Stop Shop

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