The largest health maintenance organizations in Orange County held serve during the past year.
The eight HMOs on this year’s Business Journal list combined for a 2% gain in local members, to about 1.26 million.
Continuing employment lags and the spotty economic recovery likely kept growth rates tamped down.
The Business Journal ranks the health maintenance organizations by local enrollments.
Two of them saw increases, three posted declines and three held steady, based on Business Journal estimates.
None of the eight plans changed ranks from a year ago.
No. 7 Cigna Healthcare, a unit of Philadelphia-based Cigna Corp., had the largest increase in enrollment by percentage, a 13% gain.
Oakland-based Kaiser Permanente topped the list once again.
Kaiser reported 433,000 enrollees in the county, 7% higher than a year ago.
Earlier this year, Julie Miller-Phipps, senior vice president and executive director of Kaiser’s Orange County operations, said the company has added 60,000 members in the past two years.
The membership growth has led Kaiser to “supersize” with a $461 million hospital that’s under construction in Anaheim and scheduled to open in late 2012. Most of Kaiser’s members live in North and Central Orange County, according to Miller-Phipps.
Kaiser also owns hospitals and has an affiliated medical group here. It expanded its local presence with a hospital in Irvine in 2008.
No. 2 Indianapolis-based Anthem Blue Cross held steady with 290,000 members in the county, according to a Business Journal estimate.
No. 3 UnitedHealthcare/PacifiCare, based in Minnetonka, Minn., has an estimated 179,000 members, flat from a year ago.
No. 4 Los Angeles-based Health Net Inc. reported membership of 141,000, down 2% from a year ago.
No. 5 San Francisco-based Blue Shield of California has an estimated 109,000 members, even with a year ago.
Blue Shield recently made news here with a plan to join with Orange-based St. Joseph Health System—which has four hospitals here—to form what’s called an “accountable care organization.”
Blue Shield and St. Joseph will be responsible for caring for 30,000 Blue Shield patients within the accountable care organization starting next year. The hospital and insurer are aiming to cut costs by coordinating care (see related story, page 16).
No. 6 Aetna Inc., based in Hartford, Conn., reported the biggest drop in the past year, a 9% dip that left it with 56,726 enrollees in the county.
“Companies and individuals are making hard decisions based on the current economic environment,” said Anjanette Coplin, an Aetna spokeswoman. “We are seeing members that are choosing to move to lower-cost plans.”
The company is offering such plans, including PPOs with higher deductibles and a lower-cost HMO called Aetna Value Network, Coplin said.
Cigna said its gains were driven by a similar trend, according to Christopher De Rosa, president of the company’s Irvine-based West region.
Customers are “finding value in our products and services,” he said.
Scan Health Plan, a Medicare HMO that’s just over the county line in Long Beach, saw membership fall 4% to 18,282.
PPO Directory
Preferred provider organizations listed in the Business Journal’s directory (see page 20) combined for a 6% increase in enrollments in the past year, to more than 850,000.
Five of the PPOs listed reported enrollment figures to the Business Journal. Information on the other five is based on Business Journal estimates.
PPOs primarily differ from HMOs because they allow patients more options on healthcare for a higher price. They have gained business at the expense of HMOs in recent years, particularly during the late 1990s and early 2000s, when the economy was stronger, competition for workers was more intense and employers were more likely to use benefits as hiring lures.
The PPOs’ appeal seems like it’s diminished more recently because of the uncertain economy and HMOs taking steps to allow members more choices on healthcare.
Cigna had the largest membership gain among the PPOs that reported numbers—its local membership was up 367% to 49,889 people.
De Rosa said that Orange County employers are receptive to “how we help clients and customers improve their health over the long term, leading to lower costs for everyone.”
The county’s PPO enrollment was basically flat over a year ago without Cigna in in the mix.
MultiPlan Inc., a New York-based PPO, reported having 72,500 members in Orange County, a gain of about 9%.
MultiPlan is now owned by a pair of private equity investors, BC Partners of New York and Menlo Park-based Silver Lake.
Another MultiPlan-owned unit, Beech Street Corp. of Lake Forest, said its local membership totaled 43,000. That’s a decline that comes as the company is phasing out the unit and shifting enrollees to other MultiPlan units.
Beech Street was established some 60 years ago and put its first PPO network together in 1984. It’s considered a seminal player in the PPO movement.
Anthem Blue Cross is the largest PPO by membership on the directory. We estimate it has 290,000 local members.
Blue Shield reported 132,291 local PPO enrollees, down 2% from a year ago, and Aetna has 128,443 OC enrollees, up nearly 7% since last year.
