payers & providers california edition – issue of june 23, 2011

8/6/2019 Payers & providers California Edition Issue of June 23, 2011

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In a rare retreat regarding the premiums itcharges enrollees, Anthem Blue Cross ofCalifornia has settled class-action litigation byagreeing to relax restrictions on more than

122,000 policyholders. It also agreed to cutpremium hikes for 18,000 other small groupenrollees.

In 2009, Anthem closed four plans to newindvidual enrollees PPO Share 500, PPOShare 1000, PPO Share 1500 and PPO Share2500. Those remaining in the plans wereprevented from moving to other plans withoutrst undergoing medical underwriting, whichcould have jeopardized their coverage. Theirpremiums were also allegedly raised out ofproportion to enrollees in other plans, andtheir deductibles were often raised beyond theoriginal limits.

The Santa Monica-based advocacy groupConsumer Watchdog sued Anthem on behalfof policyholders in Ventura County SuperiorCourt last year, claiming violations of theCalifornia Business and Professions Code andunjust enrichment.

Consumer Watchdog ofcials had termedthe practice of closing specic policies adeath spiral, claiming in addition torestricting existing enrollees from moving toless expensive policies, Anthem often imposedonerous premium increases to maintain theircoverage.

Since older patients or those with

preexisting conditions often cannot switch to a

comparable or better policy under existinglaw, they are trapped in the closed policy,Consumer Watchdog said in a statement, andsubject to bigger and bigger premium

increases until they are forced to acceptgreatly inferior coverage or drop coveragealtogether.

In one example, Donna Freed and RandyFreed of Goleta changed their PPO Share1500 policy when their premium reached$1,800 a month. Although their premium wasreduced to $1,100, their deductible leapt to$5,000.

"The settlement with Blue Cross is verypositive news for consumers like my husbandand myself who have been trapped in policieswith spiraling rate increases. Now we willhave the option to move to another policy

without underwriting," said Donna Freed, whowas one of the named plaintiffs in the suit.

Under the terms of the settlement,medical underwriting will be eliminated tochange out of the group of closed policies.Future rate increases on those enrollees whoremain will be capped, either to the lowestrate attributable to specic plans, or theaverage rate of all of the closed plans,whichever is lower, minus 2% of that total.Those still enrolled in the plans have theoption to moving to any other Anthem plan in

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July 11-12

July 17-19

Calendar

23 June 2011

July 17-20

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[email protected]

the details of your event, or call(877) 248-2360, ext. 3. It will be

published in the Calendar section,space permitting.

www.lakesidecommunityhealthcare.com

California Edition

Blue Cross Backs Off Some IncreasesWill Cap Premiums to Settle Suit, Cuts Other Hikes

Continued on Next Page
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Payers & Providers Page 2

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In Brief

Mickens NamedQueen of Valley CEO

Walt Mickens has been namedchief executive officer ofQueen ofthe Valley Medical Center inNapa.

Mickens, 54, has served asthe 193-bed hospitals chiefoperating officer since 2008. Hewas instrumental in creating a jointneurosurgery program with UC SanFrancisco Medical Center, as wellas creating a wound center.

He has played an intricaterole in the Queens impressiverecord of growth and developmentand I am confident that his visionwill continue to build on Queensheritage of meeting the needs ofthe Napa community, said JosephRandolph, the executive vicepresident of and COO of the St.Joseph Health System, Queen ofthe Valleys parent network.

Mickens is replacing DennisSisto, who is retiring after 13 yearsas CEO and 24 years with St.

Josephs.

SCAN Health PlanIssues $165K In Grants

Long Beach-based SCAN HealthPlan has issued $165,000 in grantsto California non-profit

organization to assist needyseniors in their community.

The grants of $15,000 apiecewere provided to 11 organizations,including Catholic Charities of theSan Joaquin Valley, SeniorCommunity Services in San Diegoand Avenidas in Santa Clara.

Continued on Page 3

NEWS

Anthem (Continued from Page One)

California without medical underwriting oncea year until 2013, and will be given notice ofhow their premiums would be affected.

About 35,000 enrollees some 20% ofthe total originally affected have dropped orchanged their coverage since Anthem closedthe plans. They will not benet from thesettlement.

It is important to note that this settlementadmits no wrongdoing on behalf of Anthem,the Indianapolis-based insurer said in astatement.

The settlement, initially approved byJudge Fredrick Bysshe earlier this month, isexpected to be formally approved following ahearing on Aug. 26.

California Insurance Commissioner DaveJones also announced that Anthem had agreedto cut an average 6% rate increase in nearlyhalf for 18,000 enrollees in small group plansfor businesses with two to 50 enrollees. Theaverage rate increase will be 3%, and will beno higher than 4%. The change is expected tosave policyholders about $2 million in

premiums.The drop came after Jones departme

reviewed the premium increases. A law thwent into effect on Jan. 1 gave Jones ofcand the Department of Managed Health the right to review proposed hikes, but nopower to modify or rescind them.

"Health insurance premiums haveincreased substantially in the last several yand many small businesses have given upproviding health insurance, while others astruggling to maintain coverage for theiremployees. I appreciate Anthem Blue Croagreement to reduce its proposed quarterrate increase for its Solution PPO productSmall businesses that have purchased the

Solutions PPO product will still experiencsignicant cumulative increase in rates duincreases in prior quarters," Jones said.

In April, the DMHC pronouncedAnthems planned rate hikes to 120,000individual policyholders an average of 16unreasonable, but the plan did not modifyincreases.

Hospitals Dont Support Rate BillConcern Premium Regulation Could Hurt Finances

Although Californias hospitals and healthplans have squared off on reimbursementissues for decades, they are in a rareconcordance in objecting to legislation thatwould regulate premiums.

The California Hospital Association,which represents most of the states 400 acutecare facilities, is against passage ofAB 52, abill that would give authority to the CaliforniaDepartment of Insurance and theDepartment of Managed Health Care to denyrate or co-payment increases proposed byhealth insurers operating in the state.

The legislation was passed by theAssembly 46-29 earlier this month, and is

currently sitting in the Senate, waiting for ahearing in the Health Committee. Previousversions of the bill have been vetoed byformer Gov. Arnold Schwarzenegger, aRepublican, but has a far better chance ofbeing signed into law with Gov. Jerry Brown,a Democrat, in ofce.

"We're not trying to be the voice forhealth plans," CHA President C. DuaneDauner said in an interview with Payers &Providers earlier this month. Dauner

Continued on Next Page
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Page 3Payers & Providers

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Woodland Hills-based insurer Health Net andits afliated charity has pledged up to $7million in interest-free loans to ensure thatclinics in the San Joaquin Valley remain open

in the case of a state budget impasse.When California lawmakers cannot agreeon a budget, payments to participants inprograms such as Medi-Cal are often delayedfor weeks until a budget is approved. Mostcommunity clinics in California participate inMedi-Cal.

If clinics were forced to shut down orcurtail operations, it could have a signicantimpact on entire families and communities.Were taking steps to help ensure that doesnthappen, said Dave Meadows, vice presidentof state health programs for Health Net ofCalifornia.

Especially in these difficultfinancial times, money problemscan interfere with seniors abilityto remain independent and intheir own homes as they age,said Lena Perelman, SCANsdirector of community outreach.

With these emergency assistancefunds, locally-based organizationscan work directly with seniors intheir communities who are facingimmediate challenges.

Past grants have been used toassist seniors who have losthousing due to fire, or have issuesafter being discharged frompatient care.

SCAN is a MedicareAdvantage health plan.

Loma Linda DevelopsNew Breast Cancer

Treatment

Researchers at Loma LindaUniversity Medical Center claimthey have developed a newtreatment for breast cancer thatdoes not include any patient sideeffects.

According to data from aclinical study that took place atthe hospital, a radiotherapytreatment delivered via protonbeam lead to a disease-free five-year survival rate of over 90%.The therapy was also shortenedsignificantly, from seven weeksdown to two weeks.

"The study results show thatwe are able to offer early stagebreast cancer patients a treatmentprogram that is less risky and canbe completed in less time," saidDavid Bush, M.D., vice-chairmanof Loma Lindas radiationmedicine department and one ofthe studys principal investigators.

Results of the study will bepublished in the academic journalClinical Breast Cancerlater thisyear.

denounced insurers such as Blue Shield ofCalifornia and the multimillion pay packageit provides to Chief Executive Ofcer Bruce

Bodaken.However, the organization feels it is in abind that compels it to come out against AB52, even though 8 million Californianscurrently lack insurance. Hospitals oftenhave to provide charity care if the uninsuredseek treatment in local emergency rooms.

The reason is the annual $12 billiondecit Californias hospitals must cope withwhen treating the uninsured, and Medicareand Medi-Cal enrollees. Dauner noted thatMedi-Cal is the biggest culprit, with hospitalslosing 22 cents on every dollar of care itproviders to the programs 8 million

enrollees.Much of that decit is made up from

patients in commercial plans, Daunerexplained. A regulatory device that capspremiums could wind up impacting hospitals,

whose reimbursements from that realm couldget cut.The private plans are picking up more

and more (of this shortfall) every year...theyare the only ones with money, he said.

The CHA does support what Daunertermed a comprehensive approach toreforming both premiums and payments tohospitals. But addressing one without theother could provide disastrous.

Meanwhile, as the CHA monitors theprogress of AB 52, it is coping with anotherrelated issue: its carrier just increasedhealthcare insurance premiums for its

employees by 18%, according to Dauner.

Health Net May Provide More LoansHas $7M For Clinics if Theres a Budget Impasse

The budget deadline is June 30, the end of thscal year for California. Lawmakers approva budget last week, but it was vetoed by GovJerry Brown, who said it was merely paperin

over long-term structural de

cits.Without the loans, many of our membecommunity health clinics could be forced tomake some tough decisions about the servicthey provide until a nal budget is adopted,said Jason Vega, chief executive ofcer of theCentral Valley Health Network.

Vegas organization is a consortium of 1federally qualied health centers with 100sites in 19 counties.

Its the fth year in a row Health Net andthe Health Net Foundation have made theloans available. About $15 million in loanshave been made available during that time

eriod.

CHA (Continued from Page Two)
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Payers & Providers PageOPINION

Struggling Toward An UnderstandingObvious Changes Obviously Wont Come Easily

Ross Goldberg is a member of the board of

trustees of Los Robles Regional Medical

Center in Thousand Oaks, and founder of

Kevin Ross Public Relations. He sits on the

Payers & Providers editorial board.

9-21:)!;6!


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payers & providers california edition – issue of june 23, 2011

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