Health Net of California, the wholly owned subsidiary of Health Net, Inc. (HNT), recently entered into a three-year agreement with John Muir Health, pursuant to which both will collaboratively form an Accountable Care Organization (ACO). An ACO implies a voluntary partnership between health care providers to offer coordinated high quality care to patients at lower costs and help avoid duplication of services and medical errors.
John Muir Health has been serving patients in Contra Costa, eastern Alameda and southern Solano Counties and comprises 50 primary care and specialty physicians, 5500 employees, and medical centers in Concord and Walnut Creek. Through the aforementioned deal, Health Net intends to enhance health care for its members in Contra Costa, Solano and Alameda counties, who utilize John Muir Health’s medical centers and physician network.
Through this association, the two entities will come together to establish new means to reduce the cost of care without tampering with the quality of the same. The collaboration also intends to assist patients in accessing appropriate care at the right time and at affordable prices.
For this, the ACO will resort to a combination of care management and wellness programs. These will target issues like delivery of superior quality yet cost-efficient medical outcomes through a patient-centered medical home, and training and providing of specific tools to patients with complex care requirements so that they can avoid hindrances in healing during the transition from the hospital to home.
Health Net provides health care to nearly 5.9 million individuals across the nation through programs like individual, Medicare (including Part D prescription drug benefits), Medicaid, U.S. Department of Defense, including TRICARE, and Veterans Affairs. The latest ACO is complementary to the services provided by Health Net and will thus help it to strengthen its care delivery system and attract more members thereby making way for more revenue generation.
Health Net currently carries a Zacks Rank #3 (Hold). However, better-ranked stocks in the health maintenance organization (HMO) space that look attractive at current levels include Centene Corp. (CNC), Anthem, Inc. (ANTM) and UnitedHealth Group Inc. (UNH). While Centene sports a Zacks Rank #1 (Strong Buy), Anthem and UnitedHealth have a Zacks Rank #2 (Buy).
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