Horizon’s value-based OMNIA plan is a smart alternative to Obamacare

Forbes: Horizon's value-based OMNIA plan is a smart alternative to Obamacare | Opinion

By Steve Forbes

More Americans may have healthcare coverage today as a result of the Affordable Care Act, but the act has not slowed the march of rising costs.

In 2014, the latest year for which there are statistics, healthcare spending topped $3 trillion. That represents a 5.3 percent year-over-year increase, the largest such increase since 2007. Worst, on Obamacare’s exchanges, deductibles are soaring. Many lower income Americans who now have coverage for the first time are having difficulty using that coverage due to much higher out-of-pocket.

Moreover, it is still cost-prohibitive for small businesses to offer healthcare coverage plans. That's why millions of people are actually getting less routine medical care than before the passage of Obamacare.

According to the Centers for Medicare and Medicaid Services (CMS), spending for hospital care nationwide increased 4.1 percent to over $970 billion in 2014 compared to 3.5 percent growth in 2013. Spending on physician and clinical services increased 4.6 percent in 2014 to more than $600 billion from 2.5 percent growth the previous year. Retail prescription drug spending jumped 12.2 percent to nearly $300 billion.

In the absence of the Affordable Care Act making any positive impact on affordability, it has become increasingly important that healthcare providers be innovative and do what government has not: lower healthcare costs while increasing availability. In my home state of New Jersey, the largest health insurer is Horizon Blue Cross Blue Shield of New Jersey, which is creating an alliance with physicians, hospitals and health systems to bring costs under control through value-based, patient-centered care.

The OMNIA Health Alliance unveiled by Horizon BCBSNJ produces a collaborative effort in the healthcare industry to provide tools to improve the quality of care while reducing costs.

To meet this ambitious goal, the OMNIA plan created tiers of hospitals and doctors to allow consumers to save money on premiums and out-of-pocket expenses by choosing the coverage that is best for them.

The OMNIA model should be a national model for addressing out-of-control healthcare costs. Making healthcare insurance more affordable to consumers can only happen if costs are reined in and brought under control.

Tiers like those in OMNIA help achieve that by giving consumers the choice to save money on their premiums and out-of-pocket expenses.

Steve Forbes is chairman and editor in chief of Forbes Media and a New Jersey resident.