UCSD to Discontinue
Its Pilot Medicare
Program at Year-End
The success of a local subsidized health plan for small businesses has gained national recognition.
Focus, a program that provides local businesses and indigent uninsured workers subsidized health care through Sharp HealthCare, has received top honors by the Healthcare Leadership Council.
The council, a coalition of chief executives from the country’s leading health care companies and institutions, presented the Focus program with the “Honor Roll for Coverage” award July 6 at NLP Furniture Industries in Chula Vista.
According to Joseph Cabrera, president and CEO at NLP Furniture, the award is well deserved.
The furniture maker is one of 161 businesses participating in Focus.
“I am praying that Focus will continue,” Cabrera said. “If it doesn’t, I’ll bite the bullet and offer health insurance , but it would be extremely hard.”
Cabrera, who was Focus’ first participant, said the subsidized program was a godsend for the small firm.
Cabrera said he couldn’t afford to buy health insurance and watched helplessly as workers fled to rival firms that offered health benefits.
Since Focus was implemented, turnover at NLP has been virtually zero. This has given NLP a competitive edge in the industry, he said.
Cabrera said his employees pay half of the health care bill , between $27 and $36 each a month.
Focus was conceived in April 1999 when the San Diego Alliance Healthcare Foundation injected $1.2 million to get the program running.
The California Endowment in Los Angeles contributed $400,000 and the California Healthcare Foundation gave $250,000 toward the endeavor.
The pilot program will be evaluated in April 2001.
A spokeswoman from the Alliance Healthcare Foundation said the foundation and Sharp hope to continue the program beyond 2001 through a public and private partnership.
“The Board of Supervisors, especially Dianne Jacob, has expressed interest in this approach to health care coverage for small business,” said Stephanie Casenza, a spokeswoman for Alliance Healthcare Foundation.
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UCSD Stops Medicare Plan: UCSD Healthcare said low membership and high administrative costs are forcing it to discontinue its Medicare pilot program at the end of the year.
Starting Dec. 31, the fewer than 4,000 UCSD Senior Health Plan members will have to use traditional fee-for-service Medicare or find another HMO plan that offers Medicare for the elderly.
Dr. Charles Mittman, dean for clinical affairs at the UCSD School of Medicine, said reductions in enrollment in managed care plans for seniors has become a national trend.
Jayne Chaffin, executive director of managed care at UCSD, cited two reasons for the steep decline in enrollment: The pulling out by large Medicare HMO providers and seniors being turned off by the public’s negative perception of HMOs.
Chaffin said more than 700,000 beneficiaries will lose their Medicare HMO coverage by the end of the year as a result of large HMOs pulling out of markets where they lose money.
“The big HMOs are pulling out, because they say the federal government isn’t paying enough,” she added.
Senior enrollment into Medicare HMO plans has also been far less than expected.
Chaffin said health experts expected 70 percent of seniors to enroll in Medicare HMOs by this year; only 53 percent of seniors have done so thus far.
“I think their natural skepticism combined with negative things in newspapers kept them from enrolling,” Chaffin said.
In San Diego County, 172,000 seniors are enrolled in Medicare HMOs as of December 1999, she said.
Tim Zinn, president of the consulting group Zinn Enterprises in Rancho Santa Fe, attributes the nationwide slowdown in Medicare HMOs to other available choices on the market.
Mittman said in order to make the Senior Health Plan work, UCSD needed about 12,000 participants.
The UCSD Senior Health Plan was developed in 1997 as a three-year initiative sponsored by the Health Care Financing Administration to test alternative payment methods, UCSD reported.
Enrollment began in July 1998.
Send health care news to Marion Webb at mwebb@sdbj.com.
