Managed Care Report

• Blue Cross and Blue Shield of Illinois (BCBSIL; Chicago) may be acquiring other managed care firms like a merger-driven Wall Street firm, but CEO Raymond McCaskey is balking at the health insurer’s need to run with the bulls – at least for now, reported the Chicago Tribune. BCBSIL is staying policy-holder owned, McCaskey said, because of its healthy balance sheet and dominant position, despite the large number of other Blues plans that are turning to public stock offerings as a way to raise money. But observers and rivals, the Tribune reported, wonder how long BCBSIL will be able to stay a mutual company in a capital-intensive industry consolidating into larger players with greater financial needs.

• Kaiser Permanente, which has suffered three years of steep losses in its North Carolina operations, is planning to stop doing business in the state, a source familiar with the company’s plans told the Charlotte Observer. Kaiser said earlier this year that its Charlotte division was for sale, but, at that time, it planned to keep the larger and better-performing operation in the Raleigh-Durham-Chapel Hill Triangle. But, the Observer reported, continuing losses have persuaded Kaiser management to leave the state entirely.

• Rhode Island hospitals, labor unions, and U.S. Rep. Patrick Kennedy (D-RI) have made an appeal to the Rhode Island General Assembly for a moratorium on the formation of new Blue Cross and Blue Shield health networks. Blue Cross and Blue Shield of Rhode Island, which received criticism for its restrictive pharmacy network with CVS, has reportedly proposed similar networks that would provide exclusive home care, medical equipment, and laboratory services for members of BlueCHiP, its HMO.

Blue Cross and Blue Shield of Michigan (BCBSMI; Detroit) and St. John Health System will partner on a three-part pilot program to improve quality of care for diabetics, cardiac patients, and women over the age of 50. The first effort is concentrated on urging St. John physicians to perform certain testing on diabetics. Future partnership projects will focus on mammography testing and the use of beta blockers on heart attack patients. The Blues’ Center for Health Care Quality is providing the data about practice patterns related to diabetes that will be used by clinical leaders at St. John in their quality improvement efforts.

• Blue Cross and Blue Shield of Massachusetts (BCBSMA; Cambridge, MA) has entered into an agreement with Pegasystems (Cambridge, MA), a provider of customer relationship management solutions, in which Pegasystems will deliver its healthcare solution to BCBSMA. BCBSMA will use the solution to enhance service to its 1.6 million members and providers nationwide.

Humana (Louisville, KY), Oxford Health Plans (Norwalk, CT), and UnitedHealthcare (Minneapolis), as of last week, are now using a single application process to credential potential medical providers for their networks. Doctors and other health professionals looking to become part of any of the three companies’ networks will fill out one universal application for network and credentialing activities. The companies say the system will take away paperwork leaving more time for patient care.

• A federal judge has denied a motion by Oxford Health Plans (Norwalk, CT) to dismiss a shareholder lawsuit alleging securities fraud stemming from a computer-system debacle that led the company to report significant losses beginning in 3Q97. The judge said the plaintiffs provided sufficient evidence that the company and several of its officials knowingly misrepresented or omitted facts about Oxford’s financial condition for the case to proceed to trial.