CHAMBER PANEL SEES NEED TO EXPLAIN NEW HEALTH COVERAGES

As competition for health insurance business heats up, members of the Cape Girardeau Chamber of Commerce's health-care committee say an educational campaign may be needed to help people understand coming changes.

Health-care discussions are filled with talk about managed care, gatekeepers, capitation, PHOs and HMOs. It can be confusing, especially for people in Southeast Missouri who aren't familiar with what the terms mean or what changes are on the way.

Wednesday morning, Dr. William Shell and Dr. David Westrich of MidAmerica HealthNet Inc., a physician-hospital organization, spoke to the chamber committee. Randy Ressell of Blue Cross-Blue Shield also spoke.

MedAmerica HealthNet is a provider network of five hospitals, including both Cape Girardeau hospitals, and 200 doctors who have agreed to work together. The physician-hospital organization, referred to as a PHO, was unveiled in May 1994. It the first of its kind in Southeast Missouri.

In order to join, doctors and hospitals agreed to cut their prices. Hospitals agreed to a 19 percent cut.

After the network formed, PHO participants decided they wanted to offer health insurance to take advantage of the new network. The goals included lower cost for patients and keeping health-care business in Southeast Missouri.

Blue Cross-Blue Shield Alliance in St. Louis won the bid to provide the insurance. As part of the agreement, Blue Cross-Blue Shield agreed to profit- and risk-sharing with PHO members. If the insurance makes a profit, half is channeled to the doctors and hospitals, and Blue Cross-Blue Shield keeps the other half.

The PHO and Blue Cross-Blue Shield also have an operating committee that works together on the insurance program.

The PHO and Blue Cross-Blue Shield also are putting together a third insurance program that would be a true health maintenance organization, also called an HMO. Patients covered by HMO insurance select a primary-care doctor, called a gatekeeper. That doctor decides when a patient sees a specialist and keeps tabs on tests and treatment in an effort to keep costs down. The insurance could be available by January.

Shell said PHO network provides an advantage for patients because the PHO is working directly with the insurance company to develop the policies.

"Whatever product we come up with is a joint venture," Shell said. "We feel we have a little more input and a little more influence over the decisions."

But Jeff Andersen, director of operations for Humana, a competing health insurance company, disagreed. Andersen, who attended Wednesday's meeting, said his company thinks it can be more effective and responsive by dealing directly with hospitals and doctors. Humana doesn't want to negotiate with the PHO.

Andersen called the PHO a bureaucratic third-party that could bog down decision-making and changes.

Westrich, with the PHO, said the organization and its insurance products are community-sponsored entities interested in what is best for patients, doctors and hospitals in the area.

On the other hand, Westrich claimed that Humana "is a for-profit entity shipping profits off to their corporate headquarters."

Andersen said the questions should be, "Who can deliver health care in an efficient, cost-effective way?" He asked, "Who is doing its best for the people of Southeast Missouri?"

Since managed care is new to the area, answers aren't available yet, he said.

Andersen and Mary Dunn of the Southeast Missouri Business Group on Health asked if individual hospitals or doctors in the PHO are free to negotiate outside the PHO.

Shell explained that part of the PHO contract asks hospitals and doctors to give the PHO first shot at negotiating a deal with an insurance company. If the PHO is interested, it has 120 days to make a deal; otherwise, individual doctors or hospitals are free to strike their own deals.

For example, Shell said, Dexter Memorial Hospital was interested in an arrangement with GenCare, another insurance company building business in Southeast Missouri. The hospital talked with the PHO board, and the board opted not to sign with GenCare, so the Dexter hospital negotiated its own agreement.