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Regional Report Triangle March 2011


Blue Cross and UNC Health join to get a jump on reform

They describe it as a medical mall, but when UNC Health Care System and Blue Cross and Blue Shield of North Carolina Inc. launch an unusual Triangle-based partnership late this year, the reality is, they’re trying to get a head start in the race for health-care reform in North Carolina. The program lacks a catchy name or cost figures, but executives of both organizations say it’s expected to save Blue Cross patients, particularly those with diabetes, heart disease and other chronic illnesses, an average of $9 a month, while streamlining primary care, eliminating duplicated tests and procedures and helping them avoid crises.

The new program calls for UNC Health and Blue Cross to build and equip a medical complex of 8,000 to 12,000 square feet in Orange or Durham County. It will be staffed by UNC Health employees and provide about 5,000 patients head-to-toe care — mental-health counseling to podiatry — under one roof. The partners shy away from linking their venture to national health-care reform. However, it closely parallels reform provisions that will reward medical providers financially for good results and penalize them for bad ones. “This is a step in that direction, but we’re not calling it that,” says Jennifer James, director of medical news at UNC Health. “We don’t know of any other model like this in the United States. It’s a model of how health care can be delivered under the new law.”

>The project resembles one that Blue Cross organizations around the nation have called a “patient medical home” model for several years. By holding a single doctor responsible for a patient’s overall health, Blue Cross of North Carolina saved about $2 for every $1 it spent on the program. Providers reduced duplicated tests and frequently kept patients from being hospitalized. In a three-year pilot program that ended in 2009 for members of the state health plan, which Blue Cross administers, the insurer paid more than $4 million in bonuses to participating doctors and clinics. That partly offset their time spent teleconferencing and having e-mail conversations with patients, which allowed some to avoid office visits that Blue Cross would have had to pay for. “Our experience with that encourages us to take the ball and run with it,“ Blue Cross spokeswoman Michelle Douglas says.

UNC and Blue Cross will share costs of the new plan 50-50, including new technology to accommodate telephone and e-visits and sophisticated electronic-records systems crucial to streamlining care and avoiding duplication. The partnership, however, is not without critics such as the conservative Raleigh-based John Locke Foundation. It frets about increasing concentration of health-care delivery systems, worrying that insurers might limit patient choices, which could lead to higher costs from lack of competition. Some fear the insurer might increase its influence over how doctors practice medicine. Blue Cross says doctors will benefit financially from keeping patients healthy and treating them well when they’re sick, but it won’t meddle in their care. “We’re not going to be there day to day in the exam room, and the physicians are not going to be employed by Blue Cross,” Douglas says.

Raleigh-based RBC Bank (USA), part of Toronto-based Royal Bank of Canada, plans to increase residential mortgage lending by $500 million this year — a 33% increase over 2010 — to boost its market share in the sector. RBC says it will add more than 30 mortgage-loan officers across the Southeast. Many banks have grown skittish about making such loans, but RBC execs say there is significant pent-up demand and many qualified prospective mortgage customers.

RALEIGHRed Hat, which sells and services the Linux computer-operating system, will keep its headquarters in Wake County and add 540 jobs within nine years. The average wage of the new jobs is more than $80,000 a year. The average wage in Wake County is $42,692. It had considered moving to Boston, Atlanta or Austin, Texas.

SANFORDCoty plans to add 140 jobs this year at its local factory. That will bring the New York cosmetics maker’s employment in the region to nearly 1,000. The new hires will make lacquer for fingernails and toenails.

HOLLY SPRINGS — Swiss drug maker Novartis will build a $36 million research lab here, where it opened a vaccine plant last year. The lab will employ about 100; annual pay will average $106,200. The lab and factory will employ a total of about 450.

HENDERSONClayton Homes, plans to close its plant here this month, idling 113 workers. The Alcoa, Tenn.-based maker of modular homes will continue to operate four other factories in North Carolina, including one in nearby Oxford.

RESEARCH TRIANGLE PARK — William M. Moore Jr., 71, replaced Earl Johnson Jr., 78, as chairman of Research Triangle Institute’s board. Moore is managing partner of Raleigh-based Lookout Capital.

DURHAMHTC plans to open a research-and-development center, hiring 45 workers by the end of the first quarter. It will be one of the Taiwan-based smart-phone maker’s three R&D sites in the U.S.

SciQuest agreed to pay $13 million for Houston-based AECsoft USA and AEC Global (Shanghai) Co. They develop technology that SciQuest says will complement its software, which allows customers to buy products cheaply online.

Philadelphia Eagles quarterback Michael Vick hired Raleigh-based French/West/Vaughan to handle his nonfootball public relations and help him develop his personal brand. Terms weren’t disclosed. Vick was vilified after reports that he sanctioned dog fights at his kennel.

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