Originally created 07/21/98

Program loses two partners



ATLANTA -- Two of the three managed-care companies that have been part of Georgia's Medicaid HMO program are now ending their participation.

The state Department of Medical Assistance announced Monday that FamilyPlus and AmeriCan Medical Plans of Georgia will no longer be part of the Medicaid HMO program.

Medicaid is a state-run program that provides medical coverage for poor people.

Insurer-owned HMOs offer lower premiums than traditional insurance by negotiating group rates from select doctors and hospitals.

FamilyPlus, the only health-maintenance organization providing service to recipients outside of Atlanta, announced last week it was selling out. AmeriCan, Medicaid officials said, is in receivership.

That leaves Grady Health Care Inc., which is affiliated with Grady Hospital in Atlanta, as the only participant in the heavily publicized program.

Gov. Zell Miller had promised the program would save the state millions of dollars.

"So far, it's been a complete nonfactor," said Kevin Curtin, director of the Georgia Association of HMOs. "It's been a (state) budget nonfactor."

There should be no disruption in service to the more than 40,000 Medicaid recipients now served by FamilyPlus and AmeriCan, state Medical Assistance Commissioner William Taylor said.

"The people who depend upon Georgia's Medicaid program for their health care will continue to receive all the services they need that are covered by Medicaid," Mr. Taylor said.

In cities like Augusta and Savannah, where there are no other Medicaid HMO options, recipients would be enrolled in Georgia Better Health Care, Mr. Taylor said.

In Georgia Better Health Care, recipients choose or are assigned gate-keeper primary-care physicians who manage their medical needs.

However, Georgia Better Health Care does not pay for all of the treatments most HMOs cover, such as routine adult dental care.

Two other managed-care organizations -- Athens Area Health Plan Select and Memorial ProHealth Inc. in Savannah -- are in contract negotiations to join the HMO program.

FamilyPlus lost $3.6 million last year, state Department of Insurance reports show. FamilyPlus had about 2,700 enrollees in Augusta, 3,200 in Savannah and 2,000 in Macon as of a spring count.

HMO officials have been complaining that the rate the state's Medicaid agency pays companies -- the reimbursement rate -- is not enough to make money at a time when enrollment is relatively low.

"The biggest obstacle for the program is the reimbursements," Mr. Curtin said.

So far, just under 54,000 Medicaid recipients have signed up with one of the three participating HMOs since the program began in February 1996.

HMO officials figure about 930,000 Georgia Medicaid recipients are eligible to join the plans.

"DMA has done everything it can to make it difficult to join the plan," said Atlanta health care consultant Brent Layton, noting that other Southern states with similar programs have a dozen or more companies participating.

Three years ago, Mr. Miller mandated that the Department of Medical Assistance begin encouraging Medicaid recipients across the state to join HMOs.

The department's announced goal at the time was to sign up 200,000 people in managed care organizations, saving $20 million.