In a push to expand its health care model in the Baltimore region, health insurer Kaiser Permanente plans to spend $13 billion by 2028 as it adds more health care facilities and significantly increases its hiring.
The plans, released by the insurer Tuesday in conjunction with an economic impact report from The Sage Policy Group, include hiring nearly 19,000 new employees as the company seeks to increase its membership to 200,000 by 2028, a 230% increase.
“Our Baltimore strategy is driven by what we call impact investing. We believe health care investments can support community health, which translates to rewarding jobs, steady income, stable housing and nutritious foods,” Kim Horn, region president of Kaiser Permanente, said in a statement. “By expanding our footprint in the region, we will be able to serve more members and improve the total health of the community through high-quality health care, community partnerships and programs. All that adds up to a healthier Baltimore.”
Kaiser held a 2.5% market share in the Baltimore region in 2014, according to the Sage report. The insurer’s goals would increase that market share to 12% by 2026.
CareFirst BlueCross BlueShield is the dominant insurer in the region, with a 30% market share. Other carriers are around 8-12%, the report said.
Kaiser uses an insurance model different from other insurance carriers, one that utilizes more vertical integration. It runs its own health clinics, including some multi-specialty medical hubs.
That type of vertical integration helps reduce costs and it could also help with patient outcomes, Kaiser officials have said.
One of the benefits of the Kaiser model, the insurer said, is that doctors have access to a patient’s complete electronic health record. Within Kaiser, staffers know every visit, phone call, prescription and image a member has with their providers.
That model will help lead job growth as Kaiser seeks to expand its market share in the Baltimore region.
The insurer plans to triple its investments and expenditures. Operating expenditures were $500 million in the area in 2017 and will grow to $1.8 billion annually by 2028.
Much of the expenditures will come from new facilities. Kaiser has five medical facilities in the area and plans to add 10, bringing its total to 15.
One of those new facilities will be a second multi-specialty medical hub in Timonium, joining another Baltimore-area hub in Halethorpe. Kaiser also operates hubs in Gaithersburg and Largo.
The new 221,795 square-foot hub, announced in the spring, will offer services that include 24-hour urgent care, 24-hour pharmacy, outpatient operating rooms, a laboratory and imaging services. Kaiser will have offices for primary care providers and a wide variety of medical specialties.
Alongside the new medical centers will come jobs, though not all of them will be directly created by Kaiser. The Sage report said the overall job number include direct hires, indirect jobs created by increased partnerships with other firms and “induced jobs” created by the spending of those direct and indirect workers.
More than 4,600 people were directly employed by Kaiser in 2017. The insurer’s expansion would lead to more than 15,800 direct full-time and part-time hires, an increase of 230%.
Sage estimated that the expansion would add $920 million in tax revenue through state and local income taxes and sales tax by the end of 2028.
“Sage Policy Group has a commitment to letting the data speak for themselves, and in this case, they highlight the significant benefits of Kaiser Permanente’s expansion in Baltimore,” Anirban Basu, chairman and CEO of Sage Policy Group, said in a statement. “Kaiser Permanente’s unique model of health care delivery outperforms the majority of the marketplace, and when you apply that high level of care to the new members it will be able to reach, residents, businesses and the community have much to gain in terms of economic growth and overall health.”