Double-Digit Increases Give Way to 4% Rise; Kaiser No. 1 in OC
By ALEXANDRA LIN
Enrollment growth at the county’s largest HMOs slowed considerably in 1999, with the 10 firms on the Business Journal list showing a 4% increase in OC enrollees as of December, compared with a year ago.
This comes on the heels of two years of double-digit enrollment growth in the county.
The local results mirror a national trend, said Mary Jane Foster, a managed-care analyst at MDI International, Irvine. The main problem is that HMO rates have gone up after years of efforts to keep premium costs down, she said.
“That made them a bit less attractive,” Foster said. “There’s a renewed interest in the PPOs or some sort of hybrid plan such as point-of-service.”
While growth wasn’t as strong as in recent years, the Business Journal’s research showed total OC HMO enrollment of the 10 largest insurers rose from 890, 620 in December 1998 to 928,731 last December.
Seven of OC’s 10 biggest providers gained OC enrollees in 1999, with No. 1 Kaiser Permanente sitting astride the average with a 4% increase and No. 2 PacifiCare posting an 8% gain.
Blue Cross of California had the strongest showing of any provider that didn’t expand via acquisition. Blue Cross’ enrollment jumped from 145,490 to 170,015, a 17% hike that put it at No. 3,the same position as last year.
Meanwhile, No. 5 Aetna U.S. Healthcare, which acquired Prudential HealthCare last year, posted an 11% gain in the combined operations, to 104,859 OC enrollees.
Also, No. 9 Universal Care’s OC clientele increased by 21%, from 40,518 to 49,019. The firm acquired Healthmax America early last year.
The rankings of the three largest firms were unchanged from a year ago.
The biggest mover on the list was a firm going in the wrong direction: No. 7 Health Net saw its enrollment fall 21%, from 123,059 to 97,642, which dropped the Costa Mesa firm from No. 4 to No. 7.
Dental HMO/PPOs
Growth in OC enrollment among dental HMO/PPOs far outpaced HMO enrollment growth. Client lists grew from 962,548 to 1,123,419,a 17% gain.
PacifiCare enjoyed 14% growth, widening its lead as OC’s biggest provider of dental care. Its enrollment went from 197,101 to 223,810.
PacifiCare officials attribute the increase to the introduction of a PPO plan in March 1999. Previously, PacifiCare was excluded by companies offering a two-level plan,that is both PPO and HMO.
“By creating the PPO, it has grown our HMO product,” said Bruce Cacciapaglia, director of strategic development for PacifiCare Dental & Vision.
The next five biggest dental HMO/PPOs also all enjoyed substantial growth, topped by the 68% increase of Blue Cross of California. Its surge from 81,725 to 137,026 OC enrollees propelled it from No. 5 to No. 3 on the list.
Cigna Dental moved from No. 6 to No. 4 by going from 88,789 to 111,061 enrollees, a 25% gain.
PPOs
As has been the case for several years, several companies on the PPO directory did not report 1999 OC enrollment figures. Of those that did, Blue Cross of California was the largest with 249,863 clients, a 10% increase over its 1998 tally of 227,630.
Blue Cross went against the norm with its gains. Nine of the 13 OC PPOs that reported enrollments either lost clients or broke even.
Among reporting PPOs, total enrollment dropped from 743,281 to 682,011.
In January, Beech Street Corp. acquired MediChoice, one of the bigger PPOs in the Northeast. The acquisition increased Beech Street’s New York and New Jersey network by some 250 hospitals and more than 50,000 providers serving 1 million plan members.
MDI’s Foster says it’s difficult to track the number of PPO enrollees since most physicians have privileges in more than one hospital. Also, she said, groups frequently change plans. n
