Humana Inc. (HUM) recently entered into an Accountable Care agreement with Aurora Health Care. Effective since Jan 1, 2015, this agreement is aimed at catering to Humana Medicare Advantage (MA) members throughout eastern Wisconsin and northern Illinois.
Being a veteran in delivering health care to patients in Wisconsin and northern Illinois, Aurora Health enjoys substantial resources and expertise that is expected to help Humana deliver enhanced care to its members in the region. Thus, the Accountable Care arrangement will provide Humana MA members an easy access to Aurora hospitals, outpatient facilities, retail, pharmacies and physicians. Being a pay-for-value system, this arrangement will emphasize on evidence-based, highly integrated care thereby leading to superior medical outcomes at lower costs.
Usually the traditional healthcare systems emphasize on payment for services rather than healthier patient outcomes. Thus, at this juncture, Humana’s shift to a pay-for-value or value-based system lends it an advantage over other healthcare systems in terms of delivering better healthcare and thereby, gaining more members.
Under an Accountable Care agreement, health and wellbeing companies, and physician practices come forward to collaborate and establish an Accountable Care Organization (ACO). An ACO utilizes each others’ resources and expertise to provide coordinated high quality care to patients at lower costs. In line with the objectives of an ACO, the aforementioned deal should mutually benefit both Humana and Aurora Health. While the agreement on one hand enhances patient care for Humana MA members banking on a value-based system, it also benefits Aurora Health by complementing the latter’s aim of delivering better patient care thereby strengthening its operating capacities.
Humana boasts a 26-year long Accountable Care history which involves above 1.2 million members and 38,000 primary care physicians. It has been setting up ACOs over a long period to enhance patient care for its MA members. Last month, the company entered into Accountable Care agreements with United Hospital, Banner Network Colorado (BNC) and HealthCare Partners Nevada.
Humana currently carries a Zacks Rank #3 (Hold). Better-ranked stocks in the health maintenance organization (HMO) space include UnitedHealth Group Incorporated (UNH), Anthem, Inc. (ANTM) and Centene Corp. (CNC). While Cenetne sports a Zacks Rank #1 (Strong Buy), Anthem and UnitedHealth have a Zacks Rank #2 (Buy).
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
To read this article on Zacks.com click here.
Get all Zacks Research Reports and be alerted to fast-breaking buy and sell opportunities every trading day.
Be the first to comment