Convinced that physicians can run a better managed-care business than commercial plans, Mayo Clinic Scottsdale is joining the ranks of providers offering their own HMOs to employers.
Although some provider networks have jettisoned their health plans, a recent group of integrated healthcare systems including San Diego-based ScrippsHealth and Maine Medical Center in Portland have decided to get into the managed-care business as owners (Jan. 6, p. 8).
Mayo has applied to the Arizona Department of Insurance for a Health Care Services Organization license and plans to offer a not-for-profit HMO to public and private employers in Maricopa County.
"We're going to be doing managed care right. We'll offer a gateway and not a gatekeeper physician and do everything we can to put the patient's interest first," said Russell Heigh, M.D., medical director of the new Mayo Health Plan Arizona. "Since we will be not-for-profit, we won't have to satisfy shareholders."
The plan will be capitalized at $1.5 million-the minimum requirement for HMOs in the state-and hopes to enroll 60,000 people in the next five years, he said.
Enrollees will be served by the 500 contracted physicians, 12 hospitals and ancillary providers that make up Mayo Healthcare Network and by Mayo Clinic Scottsdale's 170 specialists and primary-care doctors. A new 132-bed Mayo hospital in Phoenix is scheduled to open in mid-1998.
It hasn't been decided whether the plan's providers will be paid on a capitated basis, Heigh said.
Mayo decided to offer the new HMO as another way for local residents to access Mayo's resources, Heigh said. The clinic already participates in two PPOs and provides administrative as well as healthcare services to American Express Co., a self-insured employer, he said. Mayo has also built or acquired several primary-care centers in the region.
Besides providing greater access to residents, the new HMO "will strengthen our partnerships with . . . the Mayo Healthcare Network," Heigh said.
The new HMO will be smaller than others in the area, such as Cigna HealthCare and FHP.
"But that smallness, we hope, will enable us to do it right and be concerned not just with illness but with true healthcare, with immunization, cholesterol screening" and other preventive services that keep a population well, Heigh said.
Mayo Health Plan Arizona will be Mayo's second HMO, following a plan established by Mayo's clinic in Rochester, Minn., in 1986, which has 5,000 enrollees. Mayo is developing another HMO in Jacksonville, Fla., a spokeswoman said.