Boeing partners with MemorialCare to offer healthcare direct to workers

The Boeing logo hangs on the company's Chicago headquarters.
(Scott Olson / Getty Images)

Aerospace giant Boeing Co. has established a preferred partnership with MemorialCare Health System to offer most of its Southern California employees a health plan option that eliminates much of the role of a traditional insurer.

Starting in January, Boeing employees who choose the MemorialCare option will have smaller paycheck deductions for healthcare coverage, no co-payments for primary care office visits and full coverage for generic drug prescriptions.

Experts say this kind of arrangement with a healthcare system is rare. The two companies said it will be the first direct partnership in California, though Boeing has established similar plans for its employees in the Seattle area, St. Louis, Mo., and Charleston, S.C.


Fountain Valley-based MemorialCare has partnered with other healthcare providers, such as UC Irvine Health and Torrance Memorial Health System, to expand its coverage network.

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“We’re really after improving quality, improving the member experience and controlling cost,” said Jeff White, Boeing’s director of healthcare strategy.

MemorialCare has had a similar program for its own employees, focusing on preventive care and heading off chronic conditions before they appear.

“For us, it gives the ability to manage the care of all these folks across the entire continuum to work on prevention and wellness and disease management,” said Barry Arbuckle, chief executive of MemorialCare.

Direct relationships between employers and health providers could become more common in response to rising health insurance costs, said Janet Coffman, associate professor of health policy at UC San Francisco.


“As providers get more experience with being part of Accountable Care Organizations and managing risk in the sense of setting fees for the employer at levels they think can cover their costs, more of them are going to be interested,” she said.

However, Coffman cautioned that such arrangements are beneficial only for large, self-insured employers, such as Boeing, which has about 15,000 employees, with 22,000 dependents, in Long Beach, Orange County and South Bay alone.

On the provider side, networks need to include an array of hospitals, physician groups and services, such as imaging or labs.

Blue Cross and Blue Shield of Illinois will be handling third-party administrative duties, such as claims, under the arrangement.

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