State OKs North Shore-LIJ to start selling health insurance

The North Shore-Long Island Jewish Health System will soon be selling health insurance.

The health system was notified Tuesday that it had been approved by the state to operate a health insurance company, two months before New York is to open up its health benefit exchange. The state's Department of Financial Services posted the license Tuesday afternoon on its website.

On Oct. 1, New York plans to open up its health insurance marketplace for lower-cost insurance as part of the federal Affordable Care Act. On Long Island, 13 companies will offer plans for individuals. The health insurance plans will take effect Jan. 1, 2014.

The health system said it will offer its insurance both on the exchange and outside it, from storefront locations.

Insurance plans for individuals and families will be sold in Long Island, Queens, Staten Island and Manhattan under the brand name North Shore-LIJ CareConnect, the health system said.

North Shore-LIJ chief executive Michael Dowling said the health system got into the insurance business to take advantage of the shift in focus from treating illness to promoting wellness, a key part of the Affordable Care Act.

"If I do all these great things and keep people out of the hospital, I don't get any of the savings; the insurers get the savings," he said.

Offering "a full-service line" also means North Shore-LIJ will have "more control over the financing side of the business," he said.

Dowling said the health system would still deal with other insurers and envisioned offering joint products with some.

Members will have access to inpatient care at the system's 15 hospitals; outpatient and specialty care at nearly 400 physician and ambulatory practices; and aftercare services such as home care and rehabilitation.

Superintendent of financial services Benjamin Lawsky commented on the North Shore-LIJ move into insurance at a Crain's Business Breakfast Forum in Manhattan Tuesday, saying that "we've seen in other states providers starting to also become health insurers, and this has the potential to really bring rates down."

Earlier this month, the state revealed how much health insurers planned to charge for different "tiers," or levels of coverage. North Shore-LIJ's charges ranged from $183.53 a month for catastrophic coverage to $568.13 for the so-called platinum tier. The benchmark "silver tier" charge is $419.62, among the least expensive offered by the 13 companies.

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