Skip to Navigation
University of Pittsburgh
Print This Page Print this pages

April 27, 1995

Pitt officials angry about HealthAmerica letter to subscribers

An April 14 letter from HealthAmerica to its current University of Pittsburgh enrollees, offering them the chance to continue receiving care from HealthAmerica medical office physicians after July 1, has raised the blood pressure of Pitt Human Resources officials and the University's benefits consultants.

Darlene Lewis, associate vice chancellor for Human Resources, called the Health-America letter "purposely deceitful" and "unethical." She said it may jeopardize HealthAmerica's chances of regaining a share of Pitt's employee health insurance business three years from now, when the University's exclusive contract with Blue Cross is scheduled to expire.

Under the agreement with Blue Cross, Pitt is dropping HealthAmerica effective July 1.

Chris Young of Mercer, Inc., a consulting firm that advises the University administration on benefits issues, said he felt "blindsided" by the Health-America letter, which was mailed — using a mailing list obtained from Pitt — the day after a meeting between representatives of Mercer, HealthAmerica and the University. "There was no mention at that meeting of this letter," Young said.

Mike Blackwood, Health-America president and chief executive officer, countered: "I should think they [Pitt's administration] would be happy that we might be in a position to help defuse the anger in their employee population [over dropping HealthAmerica]. But if they take the other view, I would have to wonder what their motive for that would be." Blackwood said the response of Pitt faculty and staff to his company's offer has been "exceedingly positive. They've thanked us for giving them the option of not having to cancel their patient-physician relationships." In its letter, HealthAmerica states that, "Beginning July 1, 1995, HealthAmerica will waive our long-standing policy of reserving our medical office capacity exclusively for Health-America subscribers. This waiver will apply only to Pitt faculty and staff and will continue for as long as you choose to stay with your HealthAmerica physician." The letter advises current Pitt HealthAmerica subscribers to enroll in Blue Cross's SelectBlue, UHN Preferred or Comprehensive Indemnity plans but not in the Keystone health maintenance organization because Keystone will not cover the cost of care provided by HealthAmerica medical office physicians.

With each of the other three options, the letter states, "you can continue to see your HealthAmerica medical office physician and still receive insurance coverage, although at a lower level of coverage than what your HealthAmerica plan previously provided. When you seek care through one of our 10 medical offices, we will submit a claim to your insurance carrier for reimbursement. Each of the above [three Blue Cross] plans will cover most medical services provided by HealthAmerica at 80 percent of the Blue Cross allowance following the satisfaction of an annual deductible.

"In order to help you adjust to the lower level of benefits if you choose to continue to see your HealthAmerica physician, HealthAmerica will not 'balance bill' you for the remaining 20 percent required by the three [Blue Cross] plans listed above. We will also waive any office copays your new plan may impose." The letter gives details on how employees in the SelectBlue, UHN Preferred and Comprehensive plans can continue to see their HealthAmerica medical office physicians.

According to Associate Vice Chancellor Lewis, the letter "is not inaccurate, technically. My issue with them [HealthAmerica] is that they don't fully disclose the full costs involved to the employee.

"HealthAmerica hasn't said what they're going to do about the difference between their charges and what Blue Cross will allow…The letter also doesn't talk about who's going to pay for ancillary services like X-rays. It's pretty clear it will be the employee who pays." In a memo to Pitt Health-America participants that appears on this page, Lewis outlines procedures for using non-Blue Cross doctors, along with a scenario detailing how faculty and staff could end up with major out-of-pocket expenses for taking advantage of the offer in the April 14 HealthAmerica letter.

A brochure recently mailed by Human Resources to employees, "Answers to Common Questions About Your Medical Benefits," describes a "transition of care" program designed to help HealthAmerica participants (and their covered dependents) currently being treated for serious medical conditions to continue seeing their HealthAmerica doctors for a limited time.

HealthAmerica's Blackwood said this week that no such agreement exists between his company and Pitt. "I have signed nothing. I have seen nothing," he said. Blackwood acknowledged that at an April 13 meeting attended by representatives of HealthAmerica, Pitt and Mercer, Inc., the University presented a proposed transition plan. "What they put on the table didn't make any sense to us…As far as I know, that's the last we've heard" from Pitt, he said.

Blackwood added that he remains willing to consider a transition plan "as long as we're not going to be hurt financially by the deal and we're not going to be told who [among current Pitt HealthAmerica subscribers] we can and can't include." Mercer, Inc.'s Young and Ronald Frisch, director of Compensation and Benefits in Pitt's Human Resources office, said they both attended the April 13 meeting and that Pitt and HealthAmerica reached a verbal agreement on a transition plan. A written agreement was scheduled to be signed late this week, they said.

— Bruce Steele

Leave a Reply