News in brief - Sept. 18, 2000

Four new HMOs to join TennCare - HMO changes antidepressants policy - Workers' comp increases coming - Pa. doctors sued on antitrust - North Texas HMOs improve

Four new HMOs to join TennCare

TennCare, Tennessee's beleaguered managed-care program serving one-quarter of its population, has selected four new plans, owned by UnitedHealthcare of Minnetonka, Minn.; Universal Care Inc. of Signal Hill, Calif.; Healthcare Solutions Group of Indianapolis; and Three Rivers Holding Inc., a publicly traded corporation owned by a Memphis family. They will be in operation by next March, replacing John Deere Health Plan and Blue Cross Blue Shield of Tennessee, which are leaving the TennCare program.

HMO changes antidepressants policy

Kaiser Permanente has agreed to a new policy requiring physicians to examine all patients before prescribing antidepressant drugs, as part of a settlement with a California psychiatrist who blew the whistle on the plan's previous policy.

Thomas S. Jensen, MD, of San Diego, sued Kaiser after he was fired for refusing to abide by policy requiring physicians to prescribe antidepressants for patients examined only by social workers, nurses and interns.

Workers' comp increases coming

Nearly one-third of workers' compensation insurers expect to raise rates by up to 20% for 2001, according to a recent survey by Conning & Co., an asset management and research company in Hartford, Conn.

The survey also found more than 90% of the 30 major workers' comp insurers surveyed expect some rate increase and the largest ones are most likely to expect large rate increases.

Pa. doctors sued on antitrust

HealthAmerica of Pennsylvania and its affiliated HealthAssurance HMO have sued a physicians group and three hospitals, claiming that they conspired to use their market power to fix prices and restrain trade.

The suit, filed in U.S. District Court in Harrisburg, claims that Susquehanna Physicians Services, the largest physician's group in Lycoming County, controls more than 40% of the county's primary care physicians.

The suit also names Divine Providence Hospital, Williamsport Hospital and Medical Center, and Muncy Valley Hospital.

North Texas HMOs improve

Although the north Texas HMO industry lost money overall in the second quarter of the year, higher premiums and industry consolidation are improving the financial outlook, according to industry analysts.

Aetna U.S. Healthcare, Cigna Healthcare and Texas Blue Cross Blue Shield all reported profits. Texas Health Choice, owned by Las Vegas-based Sierra Health Services, lost $99.6 million, including an administrative write-off of $88 million. Sierra also recently announced that it is exiting the Houston market.

PacifiCare reported a $2.2 million operating loss in the north Texas market, while the Texas Blues' NYLCare subsidiary lost $5.9 million for the quarter.