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Empower3 merges with Pittsburgh group

Altoona doctor Zane Gates’ subscription-based Empower3 primary health care organization has merged with Pittsburgh-based Spark360 to form PeopleOne Health — adding reach and capability.

Core services remain about the same as under Empower3, including primary care, labwork, radiology, generic drugs, cardiac and pulmonary testing, durable medical equipment, outpatient psychology and physical therapy for a monthly fee, with no copays or deductibles, according to Gates. Those services meet about 80 percent of health care needs.

Spark360 brings “infrastructure we didn’t have,” Gates said.

That includes distribution channels, broker networks and marketing, sales and data analytics that will enable the new company to expand into western Pennsylvania and Ohio.

Spark360 also brought skills in dealing with small businesses and expertise in wellness, health coaching and fitness, along with an app, Gates said.

With the new firm, there will be telemedicine connections with specialists at Allegheny Health Network, pharmacy counseling and affordable brand-name drugs, according to Gates.

The new company will provide a more robust insurance menu to complement the core services, helping tailor plans for businesses, depending on their size and needs, and individuals, depending on their age and health, Gates said.

A low-premium, high-deductible plan might serve a young, healthy person best, while a high-premium, low-deductible plan might be better for an older, sicker person, Gates said.

The new firm’s offerings include health reimbursement accounts that allow businesses to provide money for employees to purchase their own plans, which they can take with them when they leave those businesses, according to Gates.

Those individuals can be tied to Pennie, Pennsylvania’s segment of the health insurance marketplace established by the Affordable Care Act, Gates said.

Such individuals may be eligible for premium subsidies.

Someone making $30,000 a year could get on a catastrophic plan for as little as $10 a month, while paying the base cost of $133 a month for his organization’s core services, Gates said.

That base rate for core services also applies for individuals in business plans, although the rate can go down for larger businesses, he said.

Businesses can save as much as 20 percent to 30 percent on health insurance costs, according to a news release from the new firm.

“We’ve become a true health care company now,” Gates said.

The membership model — with fixed monthly payments like those for a gym — is designed to become cheaper with more features, as volume increases, Gates said.

It works like it has worked for the computer industry, he said.

By contrast, traditional fee-for-service medicine has not become cheaper, he said.

MRIs, developed in the 1980s, are actually more expensive now, even accounting for inflation, he said.

Much of the blame for the high cost of health care rests with the “amazing” amount of administrative costs connected to processing claims for services, copays and coinsurance, along with brokering of insurance services and management of prescription services, according to Gates.

Studies have estimated that as much as 30 percent of health care costs in the U.S. go for administration, Gates said.

A nonpartisan work group called the Council on Health Care Spending and Value estimated that administrative costs comprised 15 to 30 percent of health care spending, according to a 2020 article in Health Affairs.

And a 2003 paper by Steffie Woolhandler estimated that in 1999, administrative costs accounted for 24 percent of health care costs — based on categories for which there was clear data — but that percentage rose to 31 percent when considering estimates for categories where clear data wasn’t available, the article stated.

Gates is one of four co-founders of the new company, according to a company news release.

The others are Patrick Reilly, who co-founded Empower3 with Gates, Jordan Taradash and Chris Downie.

Mirror Staff Writer William Kibler is at 814-949-7038.

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