Sutter Health, Aetna Announce New Northern California Health Plan

Sutter Health and Aetna Inc. are launching a jointly owned health plan for Northern California, in the first time that Aetna (NYSE: AET) has entered a joint partnership with a health system in California.

Sacramento-based nonprofit Sutter and Hartford, Connecticut-based Aetna anticipate offering self-insured commercial products starting mid-2018 in the greater Sacramento area, Central Valley and Bay Area, as well as fully insured preferred provider organization products to follow in early 2019, pending regulatory approval.

Phil Jackson, CEO of health plan products for Sutter Health, called the health plan a “key commercial product” in the portfolio of products and services Sutter is developing to make care “more accessible and more affordable.”

“More often than not, the relationship between payers and providers can frequently be duplicative. I think in a partnership like this, we can be very focused and we can really leverage our respective resources and expertise to really the benefit of the community,” he told the Business Journal. “We’re very good at the delivery and innovation of health care. Aetna has an exceptional suite of insured products, services and analytics that are really going to help us hone in on where we can have the greatest impact by engaging in serving the members in our community.”

Kathy Martella, executive director for Aetna for the Northern California market, told the Business Journal that Sutter Health “fit the bill early on in the process” when Aetna was looking for a Northern California partner.

“Sutter Health really does align very well with our vision of creating health care plans that do provide access to more efficient and effective personalized care,” she said. “This Northern California market is a challenging market…and we do feel this partnership is going to achieve all of our goals and provide more efficient and effective care for our members.”

The joint venture will deliver a differentiated, personalized experience for members and is designed to help lower the cost of care, Sutter and Aetna said in a news release.

By equally sharing ownership and accountability, Sutter Health and Aetna aim to integrate the continuum of care delivery, from wellness to disease management, care coordination and access, they said. The joint venture could also streamline administrative services for members.

Sutter is the largest private company in the Sacramento region, with $11.9 billion in revenue last year. Health care providers affiliated with the nonprofit serve more than 3 million Northern California residents, the company says. Its Sutter Medical Center facility in midtown Sacramento is also the region’s second-largest hospital after UC Davis Medical Center.

Aetna said it provides health benefits to approximately 415,000 members of its plans in Northern California.

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