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SFHSS reviews Aon market assessment, weighs five models ahead of RFP
Summary
The San Francisco Health Service System board reviewed Aon’s market assessment and five possible plan‑design models — from retaining current carriers with added navigation services to consolidated single‑vendor or private‑exchange approaches — and directed staff to pursue member outreach before issuing an RFP next year.
The San Francisco Health Service System board on a special meeting reviewed an Aon market assessment and discussed five models for contracting carrier partners, staff said, as the system prepares a request for proposals to be issued early in the next calendar year.
Executive Director Abby Yance told commissioners the presentation is intended to inform “the very detailed ask that we put in a proposal” and said staff intends “issuing the request for these proposals in the first of the next calendar year.” Aon consultants described the local market, national trends in insurer‑pharmacy benefit manager alignment, and how hospital consolidation affects negotiating leverage.
Aon presented five high‑level models for the board’s consideration: an enhanced status‑quo model that adds third‑party advocacy/navigation services; carve‑outs for specific services (behavioral health, pharmacy, advocacy); a consolidated scenario in which a single non‑Kaiser carrier would administer both HMO and PPO plans and create a shared risk pool; a system‑competition scenario that lets members pick a health delivery system or ACO at open enrollment; and a private exchange that would create a marketplace of plan choices administered by a third party.
Consultants and commissioners debated tradeoffs among choice, negotiating leverage and member disruption. Aon said consolidation into a single non‑Kaiser vendor could “create a single risk pool” that may help long‑term PPO sustainability, while board members and public commenters warned consolidation can reduce competition. Aon’s actuary explained that, under the consolidated scenario, premium displays would still be separated by plan design but rating could rely more on aggregated actuarial values rather than strictly on the small PPO experience.
Interoperability and data access were recurring themes. Aon and the board emphasized that consumer‑owned data, integrated records and consistent data exchange would be central to any future contracting approach; the consultants noted industry efforts to consolidate pharmacy and claims data and urged measurement of quality so contracts can reward better outcomes.
Aon also recommended testing options to steer members to high‑value providers (centers of excellence, tiered networks and advanced primary care models) and suggested the board define carrier success metrics and elevate service‑level agreements and performance guarantees in any RFP.
Staff outlined next steps: targeted member outreach through workshops, surveys and focus groups, facilitated public engagement and development of RFP questions and scoring criteria. Yance invited attendees to sign up for outreach notices and said staff will post dates and locations for engagement sessions.
The board did not take formal action on a single model at the meeting; members asked staff to return with more data and engagement results to guide RFP drafting.
