CONCORD, N.H.-Last year, thousands of New Hampshire state employees left Blue Cross and Blue Shield for two HMOs and promises of better coverage. Now, the state workers' union says the HMOs are unfairly raising rates and using the lucrative state contracts to make money. The union is upset because its contract with the state provides payment-up to the cost charged by Blue Cross and Blue Shield-of medical insurance. Unless Healthsource and the Matthew Thornton Health Plan cut their now-higher rates, state employees will be forced to pay the difference. "They chose (the HMOs), fully believing it was going to be 100% paid," said State Employees Association spokesman Joe Caron. "We want to preserve choice...but we don't think they should be penalized for making the choice." The state and the union have asked the HMOs and Blue Cross and Blue Shield to lower rates, based on an audit comparing the amounts they collected with the amounts they paid in benefits for state workers. The union said the audit showed the state may be paying as much as $5 million too much in premiums to the HMOs. Blue Cross and Blue Shield, in effect, lowered rates 11% by returning surplus to the state that will be applied against next year's charges. The move puts its premiums below the HMOs'. Matthew Thornton lowered its rates by 2%. Healthsource has kept its rates the same. Matthew Thornton's chief executive officer, Everett Page, said the study was flawed. He said his firm will collect 27% more than it pays out in claims. But he said his 9% profit-or $680,000-on last year's state account was "reasonable and prudent" for that size of an account. Healthsource did not return a telephone call.-Associated Press
LEWISTON, Maine-St. Mary's Regional Medical Center and its parent, Sisters of Charity Health System, will provide care to HMO enrollees of Blue Cross and Blue Shield of Maine for a capitated fee. Under the arrangement, which Blue Cross said is the first of its kind in Maine for integrated health systems, the hospital and affiliated providers will keep some of the savings if the aggregate cost of caring for enrollees is less than the fixed fee, said Blue Cross spokeswoman Carol Morris. The hospital also would be "docked" part of the cost of care that exceeds the fixed fee, she said. Blue Cross will provide on-line access to its information system as well as the necessary computer equipment and software. South Portland-based Blue Cross said the multiple-year contract should result in a reduction in insurance premiums of at least 5%.
BURLINGTON, Mass.-Lahey Clinic's department of urology recently was given a $20,000 grant from pharmaceutical firm Merck and Co. to develop the Lahey Institute of Urology Prostate Center. The center's approach will be to cut across multiple disciplines of medicine to manage benign and malignant prostate disease, said the Burlington-based clinic, a multispecialty physician group practice.