Pre-paid health care program will continue at new hospital

Kelly Wittman

Members of a pre-paid health care program formerly run with the help of University Hospital can breathe a guarded sigh of relief about how long their health care coverage will continue.
Recipients of the program, which include about 1,500 residents in the metro area, received a letter last fall saying the clinical and hospital coverage they receive as a part of the Community-University Health Care Center/Variety Children’s Clinic’s pre-paid health care program would be cut in December. But one facet of the coverage appears to be secure, while the other has been extended until at least the end of April.
One part of the plan covers visits to clinic doctors, while the other includes a hospitalization plan in which the former University Hospital wrote off the difference between hospitalization bills and the amount of the pre-paid plan premium.
“The pre-pay plan will continue at the clinic as before. The only question that remains undecided is whether Fairview is going to continue hospitalization,” said Dr. Amos Deinard, director of the clinic.
The pre-paid program provides medical coverage for metro area residents who are self- or part-time employed, or for those whose workplaces provide no medical coverage.
Two problems led up to the announcement of the end of the program.
The first was that the Minnesota Department of Health reviewed the pre-paid program in the past year and decided that it constituted insurance. Currently, a community clinic can’t offer insurance without registering as a health maintenance organization, a costly process.
Because of negative feedback from plan members when the end of the program was announced, the plan gained attention at the Legislature. A bill to ensure the clinical coverage’s survival has passed through the Senate and is in hearings at the House.
The response also compelled Fairview-University Medical Center to continue honoring the hospitalization plan through April, or until arrangements are made for plan members to enroll in a different program.
Sen. Linda Berglin, D-Minneapolis, introduced the clinic bill in February, which would allow community clinics to offer pre-paid plans. Berglin said she became aware of the problem when many of her constituents, who are members of the plan, called her about the letter.
But members of the plan who require services at the Community-University clinic don’t have to worry, Deinard said, adding that as far as he is concerned, the clinic portion of the problem is solved, regardless of the outcome of the bill.
Even if the bill isn’t signed into law, the state has given the clinic two years before it must close the program, allowing plan members time to come up with alternatives.
As for the hospitalization coverage, Jean Tracy, spokesperson for Fairview-University Medical Center, said the center has extended the end-of-service date twice, first to late March and now to April 30, while senior hospital administrators make their final decisions on the fate of the plan.
“They are studying the impact of their decision now,” she said.
But the hospital might decide to discontinue writing off costs for plan patients, and instead ask them to enroll in Fairview’s Community Care program, which provides care on a sliding fee scale, Tracy said.
“As far as we can ascertain, this is the most generous plan offered by any hospital,” she said.
Under the Fairview plan, a patient gets 100 percent of their hospital bill written off if they make less than $14,000 per year. For a four-person family, the income cutoff for a 100 percent write-off is $28,000, she said. Patients with incomes above the write-off level pay increasing percentages of their bill.
But from the viewpoint of the pre-paid plan members, the sliding scale plan would be prohibitively expensive.
The Patient Action Committee –a group of pre-paid plan members who are working to get the program continued — expressed their concerns in a letter to Fairview Hospital President Richard Norling.
Erica Thorne, a member of the committee, said the clinic estimated that about two-thirds of pre-paid plan enrollees could receive private insurance at a cheaper rate, or could qualify for state medical programs. The remaining one-third might be left without any hospitalization insurance and with no way to pay for medical bills, she said.