KAISER PERMANENTE: Finds Buyers for NY, CT Businesses

      Just one month after HMO giant Kaiser Permanente announced it would retreat from the Northeast U.S., where it lost $90 million in 1998, the plan said yesterday it had two takers for its businesses in New York and Connecticut. Capital District Physicians' Health Plan yesterday announced it would take over Permanente Northeast Division's New York business, the Albany Times Union reports. Under the deal, which is subject to state and federal regulatory approval, CDPHP would trade $18 million for Kaiser's contracts with 290,000 New York members, its contracts with health providers and its office equipment. The Albany-based health plan will not take on Kaiser's health clinics or liabilities, which are in fairly grim shape after "several years of multimillion-dollar losses." Not-for-profit CDPHP has ended the past two years in the black, posting $2.8 million in 1998 and $2.3 million in 1997. "Our goal was not to add to the hysteria of the marketplace," said CDPHP CEO Diane Bergman of the plan's hopes of folding the Kaiser plan into its own (Hughes, 7/23). The deal, which would expand the company's presence from 11 counties to 28, was welcomed by state Senate Insurance Committee Chair Sen. James Seward (R), who said the "deal will ensure that Kaiser Permanente patients won't face losing their coverage or their doctor" (Chittum, Binghampton Press & Sun-Bulletin, 7/23).

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      Kaiser wrapped up similar plans to unload its business in Connecticut, announcing yesterday plans to transfer its business there to ConnectiCare Inc. under undisclosed financial terms. After losing $14.6 million in Connecticut last year, Kaiser plans to unload 43,000 of its 60,000 members there. "[O]bviously one of our main concerns, and perhaps our predominant concern, is making sure there is adequate insurance coverage for consumers who are affected," said Connecticut Attorney General Richard Bluementhal (Kauffman, Hartford Courant, 7/23).