Health Alliance loses state employees contract

Health Alliance loses state employees contract

URBANA -- The state of Illinois says it plans to save more than $1 billion on health benefits for state employees, their dependents and retirees through new contracts with managed care organizations starting July 1-- but Health Alliance Medical Plans isn't  one of the choices.

The state Department of Healthcare and Family Services announced its intention to award four new contracts, two of them new HMO contracts going to BlueCross Blue Shield: BCBS HMO Illinois and BCBS Blue Advantage.

The other two contracts would go  to HealthLink and PersonalCare.

All contracts were chosen through competitive requests for proposal. Losing health plans have up to 14 days to protest the choices.

The plans will also provide health benefits for members of the Local Government Health Plan, the Teachers' Retirement Insurance Program and College Insurance Program, and are expected to save the state about $102 million in the fiscal year starting July 1 and more than $1 billion over the 10-year life of the contracts, according to state officials.

Health Alliance is currently one of five benefit plan administrators for state employees and their dependents and covers 99,474 people through state contracts, according to company spokeswoman Jane Hayes.

That's a huge piece of the Urbana company's business. Health Alliance has about 340,000 total members, Hayes said.

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EMT wrote on April 06, 2011 at 9:04 pm

Wow. That's got to hurt.

Girn Blanston wrote on April 07, 2011 at 7:04 am people who've been going to Carle for more than 20 years are out on their ear, forced to find a new doctor and hospital to go to, since Carle doesn't accept Blue Cross Blue Shield.

I know how I'll be voting next election.

bluegrass wrote on April 07, 2011 at 7:04 am

What does that mean Girn? Who did you vote for that made this decision you don't like?

GoingtoHeck wrote on April 07, 2011 at 11:04 am

Yep. Try going to Carle for over 50 years, then having to switch. Not a happy camper here.

xb wrote on April 14, 2011 at 12:04 am

If you think you will have to switch, you have not been reading your benefits choice booklet very carefully. I'm glad more people will be triggered to at least look at the other plans (especially the OAPs such as HealthLink) rather than just pick HA without looking.

cretis16 wrote on April 07, 2011 at 8:04 am

Carle made another blunder. Company I work for had Health Alliance....last renewal they were asking for a 42% raise...this is after the 32% the previous year. These folks just are not competitive.

personali wrote on April 07, 2011 at 9:04 am

I agree with CRETIS16...Health Alliance repeatedly asks for increases which are exceptionally high. I can understand costs are going up but the requests seem too high.

SMB1 wrote on April 07, 2011 at 9:04 am

What this article doesn't share is that state employees and their families currently getting coverage with Health Alliance will have to find new doctors or pay 60-70 percent more to keep their doctors and I'm not just referring to those who go to Carle. Health Alliance provided members with providers such as Springfield Clinic, Memorial Medical Center, Southern Illinois Healthcare and McDonough District Hospital. Maybe they'll get lucky and be able to keep their doctors, but that is usually not the case when changing to another health insurance company. This article also doesn't point out that making a change to the type of plan they are discussing would mean that state employees and their families will be forced to pay 10-20 percent of all of their health care costs. While the state contract is a huge part of health alliance you can be sure that the local company that has served the area for over 30 years will be fine. They have a great Medicare and Individual department that is growing tremendously and is competitive.

mankind wrote on April 07, 2011 at 11:04 am

Thanks, that was my chief concern. I can sleep better knowing that the health insurance companies are going to be okay.

RJH wrote on April 07, 2011 at 11:04 am

That comment is unnecessarily rude. While the State employees' health care coverage is of utmost concern, you can't help but recognize the impact on Health Alliance as a company. With such a huge loss, no doubt it will affect their employees. Expect the unemployment rate to go up in the coming months! This decision hurts a lot of people.

GoingtoHeck wrote on April 07, 2011 at 11:04 am

Well stated, RJH!

RJH wrote on April 07, 2011 at 1:04 pm

GoingtoHeck is correct - I was replying to mankind's comment, not yours, SMB1!

SMB1 wrote on April 07, 2011 at 12:04 pm

Considering that I work at Health Alliance I assure you that I am well aware of the impact that this will have on Health Alliance. My comment is not rude and you obviously ignored the entire comment except for the last part. My comment states more facts about this decision govenor Quinn is making that the article doesn't even touch to bring light of how much this decision will impact all those affected like the state employess. My last comment is just stating that "IF" the state doesn't overturn their decision Health Alliance will find a way to recoup and will find a way to do all that it can to still help the community like it has been for over 30 years. My main concern is how we can help get this ridiculous decision overturned so we can continue to provide quality service to our community and while I know jobs would be lost (possibly even for myself) I'm personally more worried about all those who will be lose their health insurance that they have trusted and depended on for years and my last concern right now is whether or not I will lose my own job. So, if that is rude to you then my apologies.

GoingtoHeck wrote on April 07, 2011 at 1:04 pm

SMB1, I believe that RJH was referring to the rudeness of mankind's comment, not to your original post.

RJH wrote on April 07, 2011 at 1:04 pm

GoingtoHeck is correct - I was replying to mankind's comment, not yours, SMB1!

SMB1 wrote on April 07, 2011 at 2:04 pm

Ok, thanks! I was a little worried and yes mankind's comment was rude by completely taking my comment out of text.

mankind wrote on April 07, 2011 at 3:04 pm

Now that I've been skewered as rude, allow me to retort. I've spoken to people today who will be devastated if they have to switch doctors and hospitals in the middle of treatment or pay 60-70 percent more, as you state, for keeping the same providers. My comment was only partly facetious. I have no desire to see Health Alliance employees out on the street. But it's a little too much for me to stomach to hear that health insurance companies are going to be fine when so many people are going to be upended by another defect of our dysfunctional healthcare system.

Betty Crocker wrote on April 09, 2011 at 9:04 am

Why so dramatic? This is economics 101. The market will no longer bear the cost of Health Alliance. It is opinion that state employee's health care coverage is of the utmost importance, and not one that I necessarily share. Adequate health care coverage is important and it would appear that the state is attempting to provide adequate health care for its' employees. Good job. Also, they are trying to save me some money in the process. Sounds like a win win situation to me. If Health Alliance has priced themselves out of the market and unemployment results, that is not the fault of the state, it is the fault of Health Alliance management. If you have had the same auto insurance company or homeowner's insurance company for the past 10+ years and you haven't looked elsewhere for a bid, you are a fool. When you find another one that is less expensive and you switch in order to save 50 bucks a year, does the impact on unemployment ever enter your mind? Health Alliance/Carle/BPC have been working on creating a monopoly for years in this community. Your doctor (Carle) and your insurance company (Health Alliance) are one in the same. Do you really think that each of them sets their rates independant of one another? Why do you think that your Carle doctor won't accept certain insuarnce coverage? It doesn't pay enough! Each insurance company determines what the market will bear in terms of the cost of particular services and if your Carle doctor won't accept that, they refuse to accept the insurance. This is why Health Alliance exists. The state is not the bad guy here, the insurance companies and physician groups are.

As a non-state employee that has Health Alliance coverage, I am more concerned with how this decision by the state (which i wholeheartedly support) will affect my rates. With close to one-third fewer covered lives, Health Allinace will have to amortize their costs somehow. It is highly unlikely that the doctors at Carle will accept less reimbursement (if forced to, many of your beloved doctors will go elsewhere, who wants a pay cut?). I expect to see significant increases in rates this year and hope that my employer will not simply roll over and accept them but look for alternatives that will provide my colleagues adequate coverage without either bankrupting me or my employer. Health Alliance/Carle is likely reviewing the impact their decision (not the state's but their decision to not be competitive) will have on the rest of their business. The 99,000 lost customers is only the beginning. To offset this loss, they will have to raise the rates on the remainder of their customers, some of whom will go elsewhere for coverage (the state has already determined for us that the current rates are not consistent with the market). This was a huge gamble on the part of Health Alliance/Carle management that in the long run may have far reaching implications for their business.

What most of you want is not adequate health care coverage. What you want is a specific health care coverage that is not competitive. I'm grateful that the state (me) is not willing to pay for that.

GoingtoHeck wrote on April 07, 2011 at 11:04 am


GoingtoHeck wrote on April 07, 2011 at 11:04 am

I am personally affected here, and am quite unhappy about the loss of Health Alliance, but I do understand the bidding process and all that.

My concern is this: the State will effectively be dumping an additional 100,000+ patients into a market ill prepared to service them. Without the Carle system as a viable option (I don't count Quality Care as viable--at least, I can't afford it), the flood of former Carle patients into the current set of health care resources in East Central Illinois will severely limit patient access to medical care. This is particularly disturbing with regard to those patients under continuing treatment for afflictions such as cancer. I suggest this be studied before it's too late to do anything about it.

slg2011 wrote on April 07, 2011 at 1:04 pm

Any patients, members or employees who wish to demand that the State reverse the decision to eliminate Health Alliance should call any or all of these numbers and demand not to be transferred. Insist on lodging your complaint with whoever answers.
Springfield 217-782-0244/ 217-558-0886/ 217-558-0881/ 217-782-4520 or in Chicago 312-814-2121/ 312-814-1943/ 312-814-8466/ 312-814-0023
Can also go to 99,474 people will be forced to change their health plan. The majority will have to pay nearly 70 percent more in premiums and out-of-pocket cost to keep their preferred doctors and hospitals.

danrice56 wrote on April 07, 2011 at 4:04 pm

I work for a company that uses Personal Care, and it is one of the worst insurance companies I have ever seen. The person who owns the company is extremely cheap, and that is why he chose that insurance company as our health care option. I used to envy the University employees for their health insurance; now I feel sorry for them.

townie1 wrote on April 08, 2011 at 8:04 am

I have had Personal Care HMO for probably over 25 years and have been completely satisfied. I understand that we are not guaranteed a specific medical plan or provider and I understand that companies routinely change providers in order to get the best deal. My problem with the whole thing is that the only HMO offerings will be with a company that doesn't even have primary care providers in the area. Why even make that a choice? Then again, why am I even surprised at anything the state does?

krath857 wrote on April 08, 2011 at 9:04 am

The State expects its employees to make significant health insurance decisions only after its employees received initial notice through the MEDIA and less than one month before Open Choice Benefit Selection takes place! State employees don’t even know exactly what decisions they will have to make until May 1, 2011, according to the press release linked to the email University employees received this morning.

I have a 6-year-old son with Autism who is under the care of MULTIPLE pediatric specialists at Carle Clinic, and now my family is potentially faced with having to find other specialists to care for him well outside of our community.

I pray that the powers that be will truly hear the people who work for the State and take into consideration the highly significant changes the FAMILIES will have to endure so that the State can appear to be making fiscally responsible decisions after YEARS of making horrible fiscal decisions. Yet again, the State’s inability to properly manage funds is now coming to rest on my back and the backs of thousands of others.

Shame on the people who ultimately came to this decision.

xb wrote on April 14, 2011 at 12:04 am

Your son need not switch pediatric providers by choosing HealthLink. My family has gotten excellent care for Autism and some very signfiicant health problems under HealthLink coverage, from Carle, Christie, Provena, and specialists in other cities including the Mayo Clinic. Employees of Carle have even said to me that it is easier to get procedures approved from HealthLink than it is for them to get it approved from Health Alliance, even though Carle is part of the same parent company as HA.

I think it's a blessing in disguise that by removing HA, or even the threat of loss of that as a choice, more people will research their health plan options rather than just pick HA relatively blindly.

Besides all this, Carle employees are under some pretty significant restrictive policies by their employer as to what they can and can't say to you about Carle. I'm not sure I would trust my care to people entirely under that umbrella.

thecornerpunch wrote on April 08, 2011 at 2:04 pm

There are multiple things occurring here that need to be kept in mind........

The information presented has yet to be presented from the State themselves. I don't believe the articles have said that the State said the cost to the employees will go up through premium and out of pocket cost. Nor has the State said that the employees won't have access to those 'key' providers of Carle, Springfield Clinic and McDonough District Hospital. I realize that the rep from BCBS has indicated that the closest primary care physician is in Springfield, but no one has heard from the other carrier options to know if they have those providers in their network or not. They may not be in their network now but is it possible they will be?

We all also know that the State is in a dire financial situation right now and so they were looking at ways to save money. If these were the lowest bidders in this process that could provide the services they were looking for then isn't the correct thing to do to make this change? Our state needs to make changes and this could be a start. When a company sends out for bids for their services isn't the point to look at the lowest bid that suits your needs?

I understand it is difficult to think you might have to change physicians or have different medical benefits, however, most people go through that when their employer changes benefits or plans and sometimes on an annual basis. While it may be difficult to think about, it is not the end of the world. I also wouldn't want to see employees lose their jobs in an already struggling economy but it sounds as though Health Alliance is growing by leaps and bounds with their individual and Medicare products, and as the employee put it, they will be ok.

Hopefully the State will release the costs, benefits and networks to the employees soon so that they can all make informed decisions on their benefits choice.

concernedwithhamp wrote on April 11, 2011 at 12:04 pm

Listen, I know it sucks to have your doctors taken away from you. I also understand that reducing your benefits is not exactly appealing. However, the State of Illinois is in dire straits and something has to give. The fact of the matter is that Health Alliance has created a contractual monopoly with Carle and several other providers. This was done with THEIR interests at heart not yours.

I do not want to see Health Alliance employee's on the street but then again, I don't think many of you out there don't realize the amount of money Health Alliance sends over to the physicians at Carle. The last time I heard the numbers, Health Alliance gave each of the Carle Clinic physicians $100,000 per year for their Christmas bonuses! The Health Alliance employee's were given a $15 gift card from Schnucks that year!

So, while I don't doubt that the State's decision is going to come with some consequences, there are also some very good fiscal reasons for the decision. Maybe now Health Alliance will decide to start making decisions that are in their members best interest not their pocketbooks.