Watch out insurers -- a new competitor is preparing to go after the large employer market in Oregon, and is being led by a very high-ranking former insurance executive.
Denise Honzel, who spent 25 years at Kaiser Northwest and became its vice president and health plan manager, is guiding ZoomCare through this transition.
Within the next 30 days, ZoomCare is expected to submit documents to the Insurance Division, including its product designs, health plan benefits and rates for 2015. By law, the Division has 60 days to signal its approval. Last month, ZoomCare’s received the go-ahead as a licensed health insurer.
If all goes as planned, ZoomCare could begin offering large group employer benefits in early 2015, said Honzel, “It’d be super if we could meet that deadline.”
Once the health plan is underway, Honzel intends to stay on board and help ZoomCare with health plan operations, membership and accounting and eventually coach staff members so they can assume those roles.
“I consider myself a senior advisor, and I’m not in charge but just here to help,” Honzel told The Lund Report. “It’s not a permanent position, but as long as I have value here and they want to keep me, it’s fine. My goal is to help develop the team so they can move on and be successful in the market.”
This isn’t ZoomCare’s first entry into the insurance world; it already has several self-insured employers including DSU Trucks, which has 400 employees. In an earlier interview with The Lund Report, Dr. Dave Sanders, cofounder and CEO, said he could lower their healthcare costs by as much as 40 percent. ZoomCare has not publicly identified its other self-insured contracts.
Honzel, who joined ZoomCare in August, is very impressed with Sanders’ leadership. “He’s very charismatic, a great innovator and very passionate and is coming up with good products for the market.” She also enjoys working with the staff. “I’ve met some fantastic high energy and young people, and it’s been fun helping them do this new innovative product.”
In addition to her work with ZoomCare, Honzel is a health policy consultant for the Oregon Business Council, a role she assumed in 1995. “I’m in a kind of hiatus with the Council right now. We came out with a new strategy and are pretty much tracking what’s going on between the CCOs, the health insurance exchange and Medicaid funding, and we’re in a monitor mode rather than engaging in new implementation work.”
Earlier, Honzel helped create the Oregon Health Leadership Council and served as its executive director for five years. Under her leadership, she helped the Oregon Health Authority and governor’s office develop a Medicaid funding strategy for the 2013-2015 budget, while working on a multi-payer medical home with 14 medical groups across the state that resulted in a payment approach for 3,600 high risk patients.
She also led efforts to support administrative simplification with 10 health plans, using one secure portal that gave providers access to websites for business transactions.
Concerned about the shortage of healthcare workers, she became the first director of the Oregon Center for Health Professions at the Oregon Institute of Technology and not only developed its program expansion, but also led a multi-million-dollar funding effort. Today that center is known as the Martha Anne Dow Center for Health Professionals.
ZoomCare’s Outside Investor
Earlier this year, the news that ZoomCare had its first outsider investor -- Endeavour Capital – signaled that the neighborhood health clinic model was headed toward a major expansion and moving far beyond its rudimentary beginnings in 2006 when it only offered primary care services.
The private equity firm isn’t disclosing how much isn’t disclosing how much money it’s investing in ZoomCare, as a matter of policy, but did make a substantial investment, Sanders said, which could be worth up to $25 million. On the Portland-based firm’s website, Endeavour acknowledged that its typical investment ranges between $25 million and $100 million, ”however it does have the ability to invest substantially more.”.
With this investment, ZoomCare can offer a complete range of services up to the hospital level and expand specialty services, Sanders told The Lund Report. “We intend to continue diversifying our services so we can be innovative and go deep.”
Before accepting the offer from Endeavor, Sanders was courted by investment companies around the world. But those investors were primarily interested in having ZoomCare become a national player and open what Sanders called “a thin layer of services.”
“No way were we going to take on any controlling investor,” Sanders continued. “We preferred to go with a company that shared the same vision and the same values and intend to develop a complete healthcare system in Portland and Seattle. We have a very patient long-term care minority partner with a proven track record as a local and regional company.
With 250,000 customers last year – the majority of whom were seen in the Portland area -- ZoomCare should have fairly easy access to potential members, and has already established network relationships with hospitals in the region.
The company’s also plugging away at legislation for the 2015 session, giving it the ability to be reimbursed by insurance companies for telemedicine visits. Not only will telemedicine reduce healthcare costs, with insurance companies negotiating for lower fees, it will also help drown out the fee-for-service payment model which relies on in-person care and needs to fall by the wayside, CEO Dave Sanders, told The Lund Report in early February. Currently, 20 states require insurers to pay for telemedicine. “We’re trying to modernize Oregon,” he added.
During that interview, Sanders also said he intended to expand the neighborhood clinic model by having 37 clinics open this year in Portland and Seattle. Currently ZoomCare operates 23 clinics. “We’ll be in all the great neighborhoods,” he said.
Diane can be reached at [email protected].
