About One-Fourth of Sacramento-Area CalPERS Members Enroll in Higher-Cost PPOs That Include Sutter Health Facilities
About one-fourth of Sacramento-area CalPERS members opted to pay higher premiums to retain access to Sutter Health facilities and physicians after CalPERS decided to end coverage at those facilities under its Blue Shield of California HMO, the Sacramento Bee reports (Rapaport, Sacramento Bee, 12/15). Officials for CalPERS, the third-largest purchaser of health care in the nation, voted in May to drop some hospitals to control premium rate increases, which have increased 57% since 2002.
Blue Shield indicated that some of the hospitals being dropped had proposed rates for 2005 that exceeded the statewide average by as much as 80%. The move is expected to save CalPERS $36 million in 2005 and $50 million annually after that. Under the plan, 13 Sutter hospitals were eliminated from the Blue Shield network (California Healthline, 6/3).
According to preliminary open enrollment data released Tuesday, about 8,000 of the approximately 33,500 Sacramento-area CalPERS members affected by the policy change enrolled in higher-cost preferred provider organization plans that included Sutter in their networks. The Bee reports that two such options exist and that members enrolled in the lower-priced PPO plan pay about $82 in monthly premiums, "more than twice" the employees' premium contribution for coverage under the lowest-cost HMO offered by CalPERS.
About 14,500 of the Sacramento CalPERS members retained their coverage through Blue Shield, while about 3,000 moved from Blue Shield to Kaiser Permanente and about 6,500 moved from Blue Shield to Western Health Advantage. Neither Kaiser nor Western Health Advantage includes Sutter in their networks.
Cheryl Phillips, medical director for Sutter Medical Group in Sacramento, said, "I think there would have to be a large number of patients out of that 8,000 who decided, 'We value our Sutter physician or our Sutter hospital so much we will pay more to keep access to that care.'"
However, Paul Markovich, who manages the CalPERS account for Blue Shield, said, "The only conclusion I would take away at this time is that the majority of members ... made a choice to remain with Blue Shield." Markovich said that final enrollment data would be available in February and that a more accurate interpretation would be available then, the Bee reports.
Sid Abrams, chair of the CalPERS health committee, said, "We don't know the reasons why the affected members stayed in the Blue Shield plan or went to Western Health Advantage or Kaiser," adding, "The reasons are completely unknown at this juncture" (Sacramento Bee, 12/15).