The recently opened Novella Infusion center in Portland offers some of the latest perks in outpatient health care: private rooms where patients can sit back in recliners and watch online streaming services while receiving IV infusions to treat chronic conditions from rheumatoid arthritis to multiple sclerosis.

Novella has similar centers in Lewiston and Augusta. A second infusion company, Local Infusion, has launched a treatment center in Augusta and is opening one in South Portland this month.

The infusion centers are the latest example of insurance companies partnering with independent centers to compete directly with hospitals by providing lower-cost out-patient services such as screenings, infusions, X-rays, laboratory work, MRIs and CT scans in less clinical settings designed to appeal to patients. In this case, Anthem – Maine’s largest insurance company – and other insurers have signed agreements to provide in-network coverage for treatments at Novella Infusion and Local Infusion.

It’s a national trend that has been building for years as insurance carriers seek to contain their costs and patients become more consumer-oriented when seeking care that was once the exclusive domain of hospitals.

“I think this is perhaps a good thing,” said Ann Woloson, executive director of Consumers for Affordable Health Care, a Maine-based advocacy group. “We definitely welcome any new pathways to increase competition. This does have a chance to bring down costs. Consumers who have access to quality, less expensive care, that in theory should help with the cost of insurance premiums.”

Hospitals, however, say the competition isn’t exactly fair and creating redundant services doesn’t improve the overall efficiency of the health care system.

“The cost structure of hospitals is simply different than it is for a provider of a single service, be that an infusion center, or an imaging center or a dermatologist or anything else,” said Jeff Austin, vice president of government affairs for the Maine Hospital Association.

For Trilby Burgess, 35, of Vassalboro, who has rheumatoid arthritis, she estimates that going to Local Infusion in Augusta will save her $600-$800 out-of-pocket per visit compared to when she used to go to Pen Bay Medical Center in Rockport.

“Saving that money will be huge,” said Burgess, who gets infusions every six weeks. “Being a single mom, it wasn’t easy to come up with the money every time.” Burgess said she’s not sure exactly how much she will have to pay out-of-pocket at Local Infusion, but she believes it will be a few hundred dollars per session.

Peter Hayes, president and CEO of the Healthcare Purchaser Alliance of Maine – a nonprofit that advocates for improved health care quality, lower costs and consumer choice – said that for certain patients, the presence of infusion centers and other services will drive prices down. But for the overall picture of health care spending in Maine, the impacts of services like independent infusion centers are more murky.

From the patient’s perspective, more competition, more sites of care, more choice – that’s a good thing,” Hayes said. “These places can be more convenient than hospitals, patients can get a better care experience. But it’s unclear what impact it will have overall on the cost of care in Maine.”

Denise McDonough, president of Anthem Blue Cross and Blue Shield of Maine, said that these services up until a few years ago were almost entirely conducted in hospitals, and patients had no choice but to go to hospitals and oftentimes get overcharged.

“There’s this huge disparity in costs,” McDonough said. “Our view is the same service that can be offered in an independent facility down the street should not be hundreds of percents more expensive at a hospital.”

Anthem is offering incentives of up to hundreds of dollars in cash, depending on the service, for patients who choose the independent facilities over hospital-owned care. The insurance company is increasing awareness of the incentives to try to spur more patients to choose independent health care services.

Up until recently, there were very few independent labs, independently owned urgent cares, and very few independent imaging centers,” McDonough said. “These services were conducted almost entirely in hospital-owned facilities.”

Anthem provided some cost breakdowns of services provided at independent health centers compared to hospitals, and showed the Press Herald that a CT scan cost $436 at an independent facility, while hospital prices in Maine for the same service ranged from $802 to $1,721.

For infusions, Remicade, a treatment for Crohn’s, ulcerative colitis and rheumatoid arthritis, infusion clinic costs were $4,800, compared to a range of $14,900 to $60,000 at Maine hospitals, according to the Anthem data provided to the Press Herald. A smaller dose of the same Remicade treatment on the comparemaine.org website shows that costs at hospitals were twice as expensive when compared to clinics.

But Austin of the Maine Hospital Association, said hospitals perform many services that lose money, and so hospitals have to make up the funds by charging more for other services.

“Hospitals form the backbone of the health care system for the state,” he said. “There are parts of the health care system that lose money.  We operate many of those parts.  There are other parts of the system that finance the money-losing parts of the system.”

Austin said independent, for-profit centers “don’t run emergency rooms that are open and equipped and staffed to treat everything from a stroke to a heart attack on Christmas day. Hospitals do. It doesn’t make financial sense to stay open on Christmas day. For-profit primary care doctors don’t. For-profit urgent care centers don’t. We do.”

Austin also said that patients with more complex cases who need infusions likely need hospital-level care.

“Hospitals can’t close their clinics,” Austin said. “They have to exist for the difficult patients that other centers can’t or won’t take. Is it efficient to have a redundant for-profit clinic or would it be better to use the essential infusion clinic that must exist?”

But Hayes, of the purchaser’s alliance, said that competition by the independent health services puts pressure on hospitals to charge closer to what it actually costs to provide the service. It could also potentially reduce the market clout of hospital systems like MaineHealth and Northern Light.

“There doesn’t seem to be a logical basis to how hospitals decide what to charge for their services,” Hayes said.

But one obstacle for insurance companies is that for many patients, the cost of the service, even at an infusion center, is high enough that patients are meeting their deductible and so the cost savings is not seen by the patients. That’s where the cash incentives – called SmartShopper by Anthem – will play a role, said Anthem spokeswoman Stephanie DuBois. Some patients will save money, DuBois said, such as those who need a one-time infusion or a lower-cost infusion.

But it’s not only cost savings that’s driving the changes, but the overall patient experience, said Woody Baum, CEO and founder of Local Infusion.

“When you are introducing change, that change needs to be attractive to the patients,” Baum said. “You can’t just throw chairs in a room. You need to make it a nice experience, have private rooms, night and weekend scheduling. You need to make it a good experience if the patients are in there for hours at a time.”

For instance, Baum said initial attempts to locate infusion treatments at urgent care centers flopped because patients didn’t like the atmosphere and the immune-compromised patients needing the infusions didn’t want to be around others who could be contagious.

Burgess, the Vassalboro resident, said that the hospital experience was not pleasant, and that she felt overwhelmed sitting in a large room with numerous other patients, including some cancer patients, receiving treatment at the same time as her. Burgess said she will like the privacy of Local Infusion.

At Novella in Portland, Rebecca Greenbaum, vice president of operations, said that they can provide good services at a cost savings for patients. Novella is not only partnering with Anthem, but also all the other major insurance carriers in Maine.

“It’s a personal, comfortable space where patients can receive therapy from highly skilled clinicians,” Greenbaum said. “Patients can get in and out quick, and you are always seeing the same personnel providing the service. They are going to get to know you, where you might see different people every time you go to the hospital.”

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