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Penn Medicine and Independence Blue Cross renew transformative contract for third time

The University of Pennsylvania Health System (UPHS) and Independence Blue Cross (Independence) will continue their transformative work together to improve health care quality and delivery through a new long-term renewal of their contract. Taking effect July 1, 2022, the agreement continues a groundbreaking framework that allows both organizations to work together and provide the best care for residents in the Philadelphia region and beyond.

Value-based programs built on shared accountability for both quality and cost of care were first added to UPHS and Independence’s contract in 2012. Additional value-based programs were added in 2017, including a new slate of innovations focused on reducing the number of patients who return to the hospital within a month of going home. Within a year, that program led to a 25 percent improvement in readmission rates. Now, several years after the original value-based programs were introduced, the two organizations have announced a long-term renewal with a commitment to continue collaborating on unique programs that improve access to well-coordinated, high-quality patient care, reduce hospital readmissions, and further update functions within specialties such as radiation oncology.

“For well over a decade, this partnership has allowed us to nimbly develop new ways to provide and pay for care, ensuring that every patient gets exactly what they need, as efficiently as possible,” said Kevin Mahoney, chief executive officer of the University of Pennsylvania Health System. “Together, we’ve developed a best-in-class system of working together with a unified set of goals that ensures we’re both on the same team, working on behalf of our patients.”

“Our long-standing collaboration with the University of Pennsylvania Health System has been incredibly successful and we look forward to a continued relationship that puts high-quality, affordable care within our members’ reach,” said Gregory E. Deavens, president and CEO of Independence Blue Cross. “The early renewal of this agreement gives our members the security of knowing our two organizations continue to collaborate, ensuring access to the best-in-class care whenever they need it.

The two organizations have developed and implemented several programs together. Two more recent programs, include:

  • The Practical Alternative to Hospitalization (PATH) program, which launched out of the Penn Medicine Center for Health Care Innovation with financial support from Independence. It included a pilot for screening emergency department patients to determine who could recover safely at home through a personalized care program that utilized telemedicine, among other techniques. Roughly 9 out of 10 patients in the pilot were able to heal at home. A subsequent trial of the program wrapped up in spring 2020, and a new iteration is being planned to take it to a much larger scale.
  • Bundling of Independence’s payments for radiation oncology treatments at UPHS for breast cancer patients. The model, which the Centers for Medicare and Medicaid Services is seeking to implement more broadly, standardizes payment for a patient’s overall treatment regimen and is not tied to the specific number of treatments. The implementation of this bundled model allows Independence-insured patients to get their care at UPHS as needed immediately, without waiting for payment approval – a process which can cause treatment delays and anxiety for patients and families. At the same time, it also guides providers to be as efficient as possible, avoiding any extra treatment sessions while ensuring that no one gets too few. This program is likely to expand to other types of cancer treatment soon.

Moving through the next few years, UPHS and Independence expect to grow these types of programs and explore new ones. Telemedicine will be a particular area of focus, particularly after it grew in scope and popularity amid the COVID-19 pandemic. Similarly, at-home care and monitoring are expected to be at the forefront of efforts following expansion for more uses during COVID-19. Finally, more programs tied to cancers that have proven challenging to efficiently treat and pay for are in the sights of the organizations.


Media contact:
Diana Quattrone