PACIFICARE: Pulling Out of Midwest Market
PacifiCare Health Systems announced yesterday it plans to close its unit in Ohio and Kentucky by Dec. 31, part of a strategy to refocus business efforts in the West. The move will affect about 54,000 people covered by PacifiCare's commercial managed care products and 6,300 seniors who belong to the insurer's Medicare HMO, Secure Horizons -- its only market east of the Mississippi. PacifiCare has reached an agreement with Anthem Blue Cross and Blue Shield to provide comparable coverage for PacifiCare's commercial members and will alert Secure Horizons members to their options for securing new health coverage, such as switching to another Medicare HMO; purchasing supplemental Medicare insurance or returning to traditional Medicare. Anthem officials would not disclose how much, if anything, it paid to acquire access to PacifiCare's commercial customers (Bonfield, Cincinnati Enquirer, 6/15). PacifiCare's withdrawal is expected to result in a $3 million to $4 million charge in the quarter ending June 30 for severance and legal costs related to the surrender of its Midwest operating license; Anthem is expected to recruit many of PacifiCare's 49 Cincinnati employees (PacifiCare release, 6/14).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.