CalPERS To Allow Six Additional Hospitals To Remain in Blue Shield HMO Network
Six hospitals that were scheduled to be dropped from CalPERS' Blue Shield of California HMO network beginning in 2005 will remain in the system, pension fund officials announced Friday, the Sacramento Bee reports (Rapaport, Sacramento Bee, 7/15).
CalPERS in May voted to drop 38 of the most costly hospitals from its Blue Shield HMO network beginning in 2005 to control premium rate increases. The group said that an analysis by 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 to drop the hospitals is expected to save CalPERS $36 million in 2005 and $50 million annually after that. Members whose providers are dropped from the network will be able to enroll in one of two preferred provider plans offered by CalPERS to avoid switching physicians or hospitals.
When CalPERS announced its decision, officials said it was unlikely that all 38 hospitals voted out of the network ultimately would be dropped, depending on how many decided to negotiate lower rates. In July, CalPERS announced that four hospitals that had negotiated lower reimbursement rates with pension fund officials would remain in the Blue Shield network (California Healthline, 7/15).
The six additional hospitals that will remain in CalPERS' Blue Shield network include five Sharp Healthcare facilities in San Diego County: Grossmont Hospital, Chula Vista Medical Center, Coronado Hospital, Mary Birch Hospital and Memorial Hospital. Madera Community Hospital in Madera County also will remain in the network.
The new agreement must be approved by the Department of Managed Health Care, which is expected to decide next week. CalPERS still plans to eliminate coverage at 28 hospitals statewide (Sacramento Bee, 7/31).