History of HAP
A Simple Credo
HAP's origins date back to 1956 when UAW President Walter Reuther sought an alternative to traditional health insurance for union members.
Reuther's search ended with the formation of a physician group practice and health plan that helped revolutionize the way health care is provided and paid for in this country.
What was so revolutionary? A simple credo: that preventive health care should be affordable and accessible to anyone regardless of their socio-economic status.
Community Health Association
By 1958, Metropolitan Hospital in Detroit was purchased and the hospital's staff agreed to work on salaried basis rather than the traditional fee-for service arrangement, thus becoming one of Michigan's first prepaid group practices. The doctors and UAW needed a health plan to cover affordable access to medical services, so Community Health Association (CHA), opened its doors on December 1, 1960.
A forerunner of managed care, CHA had many features today's consumers would recognize: a copayment (then ) for office visits; a monthly premium covering a full range of health services; and preventive care coverage that encouraged members to schedule regular physical exams.
Community acceptance was hard-earned. CHA was viewed as "socialized medicine" by the medical establishment. Doctors were banned from hospital admitting privileges. Persistence paid off. In the '70s, subscribers flocked to the plan. Three medical centers were added in metro Detroit.
In 1972, CHA was acquired by Blue Cross Blue Shield of Michigan (BCBSM) and renamed Metro Health Plan (MHP). It served for several years as an alternative health plan in association with BCBSM.
Metro Health Plan, Inc.
Licensed as a Health Maintenance Organization by the State of Michigan in 1976, MHP then developed its federal application and became the nation's 72nd federally qualified HMO in 1978, after reorganizing as a separate legal entity under the name Metro Health Plan, Inc.
The Creation of HAP--A New Alliance
Also during the late '70s, Ford Motor Company commissioned Kaiser Permanente, the nation's largest, most successful HMO based in California, to study how HMOs could best serve the Detroit market.
The Kaiser study indicated that a reorganized health care program able to inspire community support could offer a viable alternative to traditional health care as well as considerable savings in premium dollars and out-of-pocket costs.
Based on these findings, negotiations between Henry Ford Hospital, Metropolitan Hospital and Health Centers, and Metro Health Plan, Inc. resulted in a new alliance-- Health Alliance Plan, the name given to the newly amalgamated health care delivery system in 1979.
Decades of Expansion
The active '80s was a time of member and provider network expansion, solidifying HAP's statewide leadership position in the managed health care industry.
HAP Senior Plus, Michigan's first Medicare Risk plan was introduced. Community hospitals, physician networks and suburban ambulatory centers were added to the HAP delivery system.
HAP Affiliates with HFHS
In 1986, HAP affiliated with the Henry Ford Health Care Corporation, now known as the Henry Ford Health System. HFHS is one of the country's leading vertically integrated health systems. As part of this affiliation, HAP Preferred became a wholly owned subsidiary of HAP. HAP Preferred launched a self-funded product line called HealthChoice.
The '90s marked the attainment of two milestones: HAP reached 500,000 members and HAP's HMO earned three year, Full Accreditation from the National Committee for Quality Assurance.
Product Line Expansion
The '90s also saw the market entry of Alliance Health and Life Insurance Company and a complete line of experience-rated products.
HAP now boasts a full spectrum of commercial and government health plan programs, many of which have flexible payment mechanisms and custom benefit designs capable of meeting the needs of a variety of health plan purchasers.
To this day, HAP is guided by its simple credo of affordable access to quality health care and preventive medicine. HAP's strengths in quality measurement, plan administration, financing and delivery of health care services, making it a highly regarded national leader in the managed health care industry.