Blue Cross, Sutter Dispute Leads Some Employers to Reopen Enrollment
In the wake of the failed contract negotiations between Blue Cross of California and Sutter Health, several large employers in Northern California are taking the "unusual step" of reopening annual insurance plan enrollment to give employees a chance to switch health plans, the San Francisco Business Times reports. Citing employee discontent about provider access resulting from the Sutter/Blue Cross dispute and the insurer's history of "contractual brinkmanship," Alameda County has announced that it will cancel its contract with Blue Cross when the re-enrollment period closes at the end of the month. The decision will likely force 2,000 HMO and 1,500 PPO enrollees and their families to shift to either Kaiser Permanente or HealthNet, the only two other health plans offered by the county. In addition, Stanislaus County has allowed its 2,000 employees to "get out of Blue Cross," as have several Northern Californian school districts. Stanford University also has reopened enrollment for some employees, and it has reported that "all 600 of its Blue Cross-covered employees who had doctors in the Sutter-affiliated Palo Alto Medical Foundation" have switched health plans. The Business Times reports that so far, mostly "public-sector agencies and institutions" have announced re-enrollment plans because they must clear the benefits changes with employees' unions; private companies without union contracts are not required to disclose such changes.
Daniel Zingale, director of the Department of Managed Health Care, said he is in favor of new open enrollments, saying that patients affected by the Blue Cross/Sutter dispute should have an "out." He added, "Everyone has the advantage of free market except the patient. Without open enrollment, the patient is stuck. This is one way of putting them back on equal footing, and I'd encourage other employers to do this." However, Peter Lee, CEO of the Pacific Business Group on Health, said that the enrollments may "discourage providers and health plans from bargaining to reach an agreement" (Doherty, San Francisco Business Times, 2/6). Judy Brooks, president of the Benefits Advisory Group, which assists businesses with benefits programs, said that employers should consider other Blue Cross options, such as allowing employees to switch from the insurer's HMO to the PPO, before reopening enrollment (Mladinich, East Bay Business Times, 2/6).This is part of the California Healthline Daily Edition, a summary of health policy coverage from major news organizations. Sign up for an email subscription.