BLUE CROSS: Medi-Cal Kudos, On-line Reach, Hospital Struggles

      A recent audit of Medi-Cal managed care's "Two-Plan Model" found that Blue Cross of California's services to Kern, Alameda and Los Angeles counties often exceed Medi-Cal expectations and fee-for-service provisions in areas of physician services, well- child care, asthma management and data reporting, according to a news release from parent company Wellpoint Health Networks, Inc.. In Kern County, 94.4% of infants covered by Blue Cross Medi-Cal managed care received well-child visits, as compared to 57.4% of infants covered by fee-for-service Medi-Cal. Further, 84.3% of Kern County Blue Cross Medi-Cal managed care enrollees received physician services, as compared to 64.3% of those covered by fee-for-service Medi-Cal. John Monahan, general manager of State Sponsored Programs, Blue Cross of California, attributes the success to extensive outreach programs, responsive customer service and the ability to provide Medi-Cal beneficiaries with multicultural materials. Monahan said, "It not only shows that the two-plan model works but in many instances is superior to the fee-for-service model. Our access and quality of care goals are realized in the two-plan model, and we look forward to working with the Department of Health Services to ensure that this level of excellence is preserved." The audit also deemed Blue Cross of California's Asthma Program a "value- added service," as it provides patients with access to pharmacy education sessions, asthma management equipment and home health visits. Blue Cross of California also provided superior data reporting, as its fee-for-service provider contracts require detailed data on all claims. Blue Cross of California is the largest provider for state managed programs in the state, with 550,000 Medi-Cal subscribers and 56,000 Healthy Families enrollees (release, 8/11).

The Big Payback
      In related news, WellPoint Health Networks announced Wednesday that it received a $183 million refund from the IRS. The refund was based on a cash payment of $800 millon during WellPoint's recapitalization. The payment went directly to two Blue Cross of California charitable organizations, rendering it tax-deductible. WellPoint is also looking forward to an additional $38 million from the same ruling. WellPoint contracts with 7 million medical members and 30 million specialty members through Blue Cross of California and UNICARE (release, 8/11).

Telemedicine Program Expands
      In an effort to "increase access to specialty care" for people in underserved rural areas, Blue Cross of California will open 22 new telemedicine sites in 18 counties throughout the state and expand capabilities at 16 existing sites. Each site will come equipped with computer hardware, high-speed data lines, and medical instrumentation, "including a general exam camera and an ENT scope." Organizers say the endeavor was made possible through a "$1.8 million Rural Health Demonstration Project award," granted by the state's Managed Risk Medical Insurance Board. "Residents of these rural communities often wait three to six months to see a specialist," said Dr. Aftab Naz, president of Madera Family Medical Group. Naz cited the scarcity of specialists, and the expense of taking time off and commuting as causes of delayed treatment, adding, "Blue Cross ... is enabling community access to care that many of these patients ... never thought possible" (Wellpoint release, 8/3).

Passing the Buck
      Doctors and hospitals are feeling the pinch from Blue Cross of California's successful efforts to hold down member costs, the Los Angeles Times reports. Touting "the company's proudest claim," spokesperson John Cygul notes that the Blues lured more than 500,000 new subscribers last year, swelling its statewide membership to nearly 5 million with low insurance premium hikes of 6%. But on the other hand, the insurer "has been highly resistant to paying more to its doctors and to upping reimbursements to its hospitals." Last year, several larger hospitals managed to wrest 8% increases from the Blues over a three-year period. Smaller hospitals have not fared as well. In March, Coast Plaza Doctors Hospital in Norwalk filed a discrimination suit against Blue Cross, charging that the insurer favors larger hospitals over smaller facilities. That case is pending, although a Los Angeles judge ruled that several larger hospitals must divulge their Blue Cross contracts. Healthcare Association of Southern California Executive Vice President Jim Lott accused Blues of "predatory pricing," and noted that Blue Cross and other for-profit plans divert as much as $.30 of the premium dollar to investments. For not-for- profits, that amount falls to $0.05, with the remaining going to health care. Lott suggested, "The cure, pure and simple, is for the Legislature to pass a law mandating that a set of percentage of premiums be dispensed to the providers ... perhaps 85%" (Reich, 8/12).