HEALTHY FAMILIES: Low Numbers Pinch Small Plans
Healthy Families' less-than-stellar start in enrolling eligible children is "putting a crunch on the managed care plans," especially "[s]maller players" that have agreed to participate in the program. The Sacramento Business Journal reports that several plans are currently losing money because of "[h]igh start-up costs, low enrollment and higher-than-expected use of services," but "expect things to turn around over the long haul." Dr. Reza Abbaszadeh, president and CEO of Access Dental, said his group was losing money on its PPO plan because most of the Healthy Families enrollees "hadn't ever seen a dentist" and required a lot of expensive care. "Our medical loss ratio is more than the entire premium, leaving nothing for administration," he said. Larger plans such as Blue Cross of California and Kaiser Permanente say it is too soon to gauge the full implications of the program, and Health Net says it appears to be breaking even. Delta Dental Plan of California is not "breaking even now, but [is] looking to the long term," according to spokesperson Jeff Album. "We don't go into these things to lose a lot of money, but we do have the financial strength to do this. We see this as a success -- not as a business, yet, but from the perspective of meeting unmet needs," he said (Robertson, 2/15 issue).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.