University Times

Proposal gives "the blues" to those who use HealthAmerica

To the editor:

It was with shock and indignation that I read the news of Blue Cross/Blue Shield's (the Blues') latest sleazy behavior in the post-Hillary Clinton health care insurance wars. My sense of dismay was so great that it has taken me nearly a month to respond. While I had served until very recently as chairperson of the Staff Association Council's (SAC) benefits committee, I am writing only as a soon-to-be-victimized health care consumer and not as a SAC representative.

In my years of service on various medical review committees, I have observed consistently evasive, arrogant, manipulative and, yes, even deceptive communication by the Blues' representatives. I have remained politely silent until now.

Their most recent "offer" to the University of incredulously huge savings if only we agree to drop HealthAmerica is certainly consistent with the Blues' cynical bartering in the health care options of western Pennsylvanians. If the University community accepts this offer, the Blues would become the sole arbiter of health care for all the staff and faculty of the University. This monopoly would set us up for an inevitable increase in rates and decline in quality of service. The Blues are simply not to be trusted.

In 1992, the Blues made a similar "offer they couldn't refuse" to the combined plan covering employees of 18 Pittsburgh area Jewish communal organizations. I recently made an informal telephone poll of a number of employees I know at several of those agencies. In those that required their employees to switch from HealthAmerica to one of the Blues' plans, there is a strong indication that the amount employees have been asked to pay out-of-pocket has risen and that former HealthAmerica clients are clearly less satisfied with their current quality of service. In those agencies, on the other hand, that allowed employees who were enrolled in HealthAmerica to remain enrolled for as long as they cared to, but to simply freeze new enrollments, there is uniform satisfaction.

These survey results are, of course, quite tentative and colored by my own perspective. (This is, after all, an opinion piece.) Perhaps the University community could learn from the experience of the Jewish agencies. At the minimum we should carry out an independent study of workplace communities that have struck exclusionary deals with the Blues before taking such a drastic course ourselves.

There is a line from the Yiddish language film "Hester Street" that translates as: "You can't pee on my back and make me think it's rain." In our current predicament, it would seem that the Blues are about to pee all over a lot of western Pennsylvanians. Let's not mistake it for rain.

In my own experience as a long-term HealthAmerica client, I have an established relationship of nearly two decades with my primary care physician, Dr. Ellen Dillinger. I have also experienced consistent success over the years with specialist referrals for services ranging from knee surgery to physical therapy to couples counseling. And all of this at one convenient location with no forms, no fuss, no phone calls and no co-pay. It feels almost like living in a civilized country like Sweden or Canada or anywhere else in the industrialized world. Needless to say, I can credit HealthAmerica with assisting in my ability to contribute to the common well-being of the University. The loss of HealthAmerica to 1,800 staff and faculty would be a loss to us all.

Steve Zupcic

Office of Public and Community Service

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Keep HealthAmerica as option for 30% of employees who use it

To the editor:

Is HealthAmerica to be dropped as an option at the University? Would dropping it be thinkable given that half the new enrollments in 1994 were into HealthAmerica? Or would it be thinkable given that over 700 employees with individual coverage are participants in HealthAmerica even though there is no employee premium for any of five insurance plans? Or would it be thinkable given that 30% of the employees insured at the University are HealthAmerica participants? Of course not, but that is just what might be about to happen. The Medical Insurance Review Committee was first informed at its Nov. 1 meeting of the plan to permit a monopoly by Blue Cross/Blue Shield, and the committee was asked to immediately endorse the plan. Faculty and staff refused to act so precipitously. It was proposed that Blue Cross would reduce our rates enough to provide a $5 million savings if we would drop HealthAmerica and exclusively offer Blue Cross options. (And $15 million over a three-year contract period). No basis for this estimated savings was provided at the Nov. 1 meeting and none has been provided as of this writing. Can Blue Cross do this without a loss? The offer could be a "loss leader" to gain a monopoly for which we would pay dearly in future years. In the absence of hard data I'll list a few relevant points.

(1) To estimate the savings they would need to guess at HealthAmerica's future rates. If they used the Health America rates from 1994 they are badly off in their estimate from the start. HealthAmerica rates decreased for 1995 — more than 6% for the family plan. (In the Pitt-Flex enrollment materials this isn't easily apparent because the administration did not pass through the decrease to the employee but rather used it to give favored treatment to less competitive Blue Cross plans).

(2) The total University payment for HealthAmerica coverage in 1993 was $8.3 million. Blue Cross would need to pay only $3.3 million for these services to realize a savings of $5 million. Even granting some benefit from a larger risk pool, the claimed savings stretches credibility.

(3) If the assumption is that HealthAmerica participants will switch to the Blue Cross HMO — Keystone — rather than the more costly plans there may be a rude surprise. In my opinion, although with a borrowed phrase, "Keystone is no HealthAmerica."

(4) Single provider vendors may provide savings when there is competitive bidding. There was no call for competitive bidding before the committee was asked to endorse the Blue Cross plan.

(5) The 42-month contract referred to in the Nov. 9 "Letter to the Community" includes the 6-month period Jan. 1, 1995 to June 30, 1995. HealthAmerica is still with us for this period but there is a savings of $1.5 millon because of the termination of the Traditional Blue Cross plan. Therefore, it appears that part of the annual $5 million savings has nothing to do with the proposed Blue Cross monopoly.

(6) Blue Cross is not promising to refrain from increasing rates in the second and third year of the contract. Rather, they promise that rises in rates will not exceed 4-10% for their four plans in year two and will not exceed 7-15% in the third year. By standards of a few years ago these might seem modest; but we are now seeing small increases, no increases and decreases in rates in a competitive environment.

In the long run we may all suffer from a Blue Cross monopoly, but the immediate severe burden will be borne by the present HealthAmerica participants. We have 1,800 faculty and staff participating in Health America. With their insured spouses and children we have 5,100 using Health America physicians. Eighty percent of these people (4,100) use the HealthAmerica centers. The center doctors are not available in any of the networks and so all of these 4,100 people will be forced to give up their internists, pediatricians, gynecologists, ophthalmologists, and others whom they trust and who have given decades of proven, quality care. They will be forced into plans which in varying degrees have deductibles and co-payments not charged by HealthAmerica. For this group there will be what amounts to a decrease in compensation. But the biggest burden for them will be the traumatic loss of their physicians.

In the last few months there has not been the kind of shared decision-making regarding benefits we have been accustomed to in the past. Let us hope we can re-establish a true team of faculty, staff and administration.

James G. Holland

President, University Senate and Member, Medical Insurance Review Committee

Darlene Lewis, associate vice chancellor, Human Resources, replies:

I am writing in response to Dr. Holland's letter to the University Times regarding employee health insurance; and I think it extremely important that I do so in a point-by-point fashion so that there is no doubt or ambiguity about what we are trying to accomplish.

1. Dr. Holland is incorrect when he asserts that the University is not passing on the savings to employees. Every employee will pay the same or less than he or she paid last year. (See published rates in ad on page 3 of this issue.) These results could not have occurred with a less competitive or favorable treatment allocation.

2. The annualized monthly 1994 premiums for the HealthAmerica Pitt-Flex eligible population is $6.3 million, rather than the $8.3 million stated in Dr. Holland's calculation. I do not understand the criteria which Dr. Holland uses to estimate the Blue Cross savings.

3. From the outset, we expressed concern that plans to be offered would be representative of the major types of medical insurance and health care delivery systems available in the marketplace. We also agreed with the Medical Insurance Review Committee's comments about the differences between HealthAmerica and Keystone. Further, we agreed that one of the priorities on the agenda of the Committee would be to address plan design issues and other employee concerns.

4. Dr. Holland is aware that HealthAmerica is submitting a proposal to the University.

5. It is true that the $1.5 million savings was a result of the closing of the Traditional Plan. However, the additional $5 million annual savings is a direct result of the Blue Cross proposal for a multi-year plan to continue the January-June 1995 savings.

6. The proposal Blue Cross rates would be capped increases. The caps are unique, and will be based on experience. If the experience is low, the rates will be lower than the caps, but will not exceed the caps.

Somehow, this notion of a "monopoly" has gained a credibility it does not deserve. The fact is the University has hundreds of sole source contracts for virtually every kind of service and product. We choose to do this because it is efficient, permits us to manage one provider, and allows us to use our economic leverage to gain advantages in service and price. In addition, a monopoly occurs when the seller has overwhelming strength and the buyer is at a disadvantage. That is not the case presently, and we are too large a "buyer" for it to become so in the future.

This proposal was presented to us by Blue Cross as a business proposition for us to consider. We will review this proposition, as well as HealthAmerica's proposal, and we will do so cooperatively through the appropriate staff and faculty committees. Let me also be clear in saying that no decision has yet been made on either proposal. May I say again, we are committed to an open dialogue with faculty and staff.

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Too much time being spent on complaints of a few dental faculty

(Editor's note: The following letter, written to Provost James Maher, is being published here at the request of the author.)

Dear Dr. Maher:

Over the course of the last year, several faculty have taken the time to mount a campaign against the current administration of the School of Dental Medicine. As one of the division heads, I take a personal offense at many of their allegations. The time that I have spent answering questions from the University Senate Process Review Sub-Committee has been excessive. The allegations, complaints and criticisms of this administration from small groups of disgruntled faculty have been counter-productive to the academic mission of this school.

Although these selected faculty members have met with you and others in the Provost's office, it is my personal feeling that they do not represent the true feelings of the majority of our faculty here at the dental school. In fact, several clinical faculty have voiced their disdain at the thought that mostly non-clinical faculty are speaking for them. The potential for further polarization of basic science vs. clinical faculty will only be made worse if this situation continues.

Over the last five years, the School of Dental Medicine has gotten stronger. The reorganization of the administrative and academic departments has allowed for streamlining and budgetary control. Out-patient operations have been updated and modernized to reflect changes in dental care delivery. Research funding has increased. The School of Dental Medicine now ranks 19 of 55 dental schools in funding dollars. A revised curriculum is now fully implemented and student passing rates on National Boards and Regional Exams has significantly improved.

Therefore, it is my personal impression that the allegations made by those selected faculty do not represent reality, however, they have spent hours of time mounting a "campaign of negativism." Please understand that most of the faculty, staff and students believe in and actively support the administration of the School of Dental Medicine.

I would be happy to discuss this further, however, all too much time has been spent on these issues. I, along with other members of the administration, appreciate the time you have spent dealing with our faculty. Hopefully, all sides of these allegations, complaints and criticisms will be heard and the flurry of activity will soon calm down.

Margaret A. Elliott

Associate Professor

Head, Division of Administration

School of Dental Medicine

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Dental alumni group former president supports school's dean

To the editor:

As immediate past president of the Dental Alumni Association of the University of Pittsburgh School of Dental Medicine, I have a great opportunity to interact with not only the alumni but with the faculty and students.

During the course of any conversation relative to the School of Dental Medicine, great concern is always directed towards funding, leadership and standing of our school.

Our school's reputation is spreading nationally, and the number of out-of-state applicants has increased. This may be a reflection of a dramatic jump in our National Board score performance, but in 1993, we ranked 12th.

Perhaps the school is attracting more applicants because our current students are leaders in student professional groups. Pitt dental students have been elected to several national offices in the American Student Dental Association, and one of our students serves as national president of the Student Research Group. Our students have received national awards from professional associations and international awards in Scotland and Japan.

Our alumni are extremely proud when we read statistics such as the class of 1998 scholastic record. Three years ago, the grade point average (GPA) of the dental school's entering class was 2.6; the class of 1998 has a mean GPA of 3.0.

A great part of this is due to our administrative leadership in the School of Dental Medicine. Under Dr. Suzuki's deanship, we have moved in a positive direction. We are well on our way to becoming one of the top dental schools in the nation.

We are extremely proud of Dr. Jon Suzuki, a noted researcher, clinician and academician who is at the forefront of the exciting changes taking place in the School of Dental Medicine.

As a result of the upswing in the number of student applications, the increase in QPA of the students, and overall positive response to Dr. Suzuki, funding and financial support to the school can also be expected to increase.

It is my sincere wish and that of many dental alumni, that we will have Dr. Suzuki with us well into the 21st century.

Harry N. Pasqual

Immediate Past President Dental Alumni Association

University of Pittsburgh

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Chancellor's support for entrepreneurial activities is applauded

To the editor:

I wish to first applaud the leadership that Chancellor O'Connor has repeatedly demonstrated by his encouragement and support of University activities which promote the entrepreneurial climate in western Pennsylvania.

In the recent Chancellor's Column (Nov. 23 University Times), he outlined many of these University initiatives.

I would also like to take this opportunity to highlight the vibrant strength of the Small Business Development Center (SBDC) of the Katz Graduate School of Business in the local economic development landscape. During the past year, in the spirit of public service at KGSB, we have provided management consulting to over 750 businesses, had over 1,200 business owners attending our free or low-cost training programs and raised over $4 million in capital to help our small businesses to expand and grow. We can also claim a significant part in helping over 50 new businesses open their doors for the first time.

In addition, during the past six months we have been busy forming a new partnership with the School of Engineering at the Manufacturing Assistance Center (MAC). We believe that business education goes hand-in-hand with technology transfer, and the powerful resources available at these two schools can only solidify the University's impact on the vitality of this region.

Dr. O'Connor's support of our SBDC program and participation in our activities in Allegheny and Washington counties, as well as with our new venture at the MAC facility, are greatly appreciated. During the chancellor's recent visit to the MAC, he remarked how we at Pitt don't always tell the world all the contributions that we make on a daily basis. I for one plan to do a better job sharing the activities of this great University.

Ann Dugan

Director

Small Business Development Center

Katz Graduate School of Business