Many State Health Plans Spent Larger Percentage of Revenue on Patient Care in 2000, CMA Study Finds
Increased health care costs forced a number of state health plans to spend a larger percentage of their revenue on patient care in 2000 than in 1999, according to a study released last Friday by the California Medical Association, the San Diego Union-Tribune reports. In the study, CMA researchers analyzed data that 41 California health plans filed with the state and the federal Securities and Exchange Commission. The study found that 23 of the health plans spent a larger percentage of their revenue on patient care than they had the year before, while 12 spent less and one spent about the same. CMA researchers did not receive sufficient data to analyze five of the health plans. Aetna U.S. Healthcare, Blue Shield of California and PacifiCare increased the percentage of revenue spent on patient care in 2000, while Blue Cross of California and Health Net spent less, the study found. Steven Thompson, vice president of government affairs for the CMA, attributed the increase to a rise in health care costs, including "soaring" prescription drug costs. Patient care costs have increased for health plans "basically because health dollars have been squeezed more and more," he said. Walter Zelman, president of the California Association of Health Plans, said that the study also "reflects the growing negotiating power" of doctors and hospitals, which have secured better reimbursement rates from health plans in the past few years (Fong, San Diego Union-Tribune, 3/30).
In related news, the Sacramento Bee on Sunday profiled newly elected CMA President Dr. John Whitelaw, an obstetrician and past president of both Sutter Medical Group and the Sierra Sacramento Valley Medical Society. The Bee reports that Whitelaw faces the challenge of "improving access to care at a time when understaffed health systems in California and around the country are struggling to make ends meet and keep pace with rapidly changing patient needs." Whitelaw said, "Access is a bottom-line issue we have to address." In addition, the Bee reports that Whitelaw must address the "perception that the association's main goal is protecting its members' wallets" at a time when "many in the industry are uncertain what the future holds" (Rapaport, Sacramento Bee, 3/31).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.