LETTERS: ALLIANCE BLUE CROSS WEIGHS OPTIONS

To the editor:

The surprise action by MedAmerica HealthNet Inc. in filing for bankruptcy and then voting to dissolve the company has created understandable confusion and concern in the Cape Girardeau area.

I want first to reassure our members that they are our primary concern and that Alliance Blue Cross Blue Shield is exploring every option possible to avoid disruption in their health-care coverage.

Blue Cross and Blue Shield has been in business in Missouri for 61 years. We have been in Cape Girardeau nearly 30 years. We now have 300 employees in Cape Girardeau with an annual payroll of $5.4 million. More than two-thirds of our employees are covered by HealthNet Blue.

It's important to remember that the joint-venture agreement between MedAmerica and Alliance came about when MedAmerica began looking for an insurance partner to help bring the benefits of managed care to Southeast Missouri through local providers. Alliance was the only company willing to step forward to share the benefits -- and the risks -- that the venture entailed.

Insurance is a risk business, and everyone involved must be prepared to share any downside, just as they are prepared to share any gains. Under the joint-venture agreement, MedAmerica agreed to share 50-50 in any gains or losses. Unfortunately, we have experienced significant losses. We view the bankruptcy filing as an attempt by MedAmerica and certain of its providers to avoid their share of the losses.

We certainly understand MedAmerica's frustration with the Missouri Consolidated Health Care Plan. Our own frustrations are a matter of record -- court record. We filed suit against Missouri Consolidated because it breached its contract with us, has given preferential treatment to our competitors and has failed to comply with the Missouri Sunshine Law, the Administrative Procedures Act and Missouri Consolidated's own enabling statute. The result has been we are subsidizing the Missouri Consolidated plan.

Despite the losses MedAmerica and Alliance have experienced, we are still convinced that managed care is the best way to balance the cost and value of health care in Southeast Missouri, just as it is in the entire market.

We are looking at all our options, including network options, to find the best way to continue to protect our members. We are, for example, talking with Cape Girardeau-area physicians and hospitals about contracting with us. As soon as we have evaluated our options, we will immediately communicate our decision to our members, to providers, to brokers and to the community. We want our members to have the full benefits of their health-care coverage, and we hope that the Southeast Missouri medical community shares that goal.

JOHN A. O'ROURKE, Chairman, President and CEO

Alliance Blue Cross Blue Shield

St. Louis