News in brief - April 2, 2001

Texas HMOs report more losses - Fla. Medicaid drops HMO plans - Kentucky investigating Anthem - Nonprofit hospitals improve

Texas HMOs report more losses

Texas HMOs lost more than $567 million and 24 of the state's 42 plans reported losses, according to the Texas Dept. of Insurance. The department says HMOs have lost $1.5 billion in Texas since 1996.

North Texas HMOs were hit the hardest, losing $338 million during 2000 compared with $213 million last year. Of the 14 HMOs that do business in Dallas and Fort Worth, just six posted profits for the year.

A Florida Senate health subcommittee rejected Gov. Jeb Bush's proposal to shift 370,000 Medicaid recipients into HMOs, after some pediatricians expressed concern the plan would reduce the quality of care for children.

But with the state Medicaid program facing a $1 billion budget shortfall, legislators said they are considering another tack: requiring prior authorizations for physicians to prescribe certain drugs.

Kentucky investigating Anthem

Kentucky officials are investigating a complaint that Anthem Blue Cross and Blue Shield of Kentucky incorrectly required some patients to make co-payments for interpretations of x-rays and lab work.

Anthem officials said they thought they had resolved the matter earlier this year. But state officials have found possible evidence of more improper co-payments.

Nonprofit hospitals improve

The nonprofit hospital industry is looking healthier this year, according to a recent survey.

Higher fees paid by insurers and federal changes to alleviate financial stresses created by the Balanced Budget Act of 1997 will help stabilize credit ratings for the facilities by the end of 2001, according to an industry outlook published by Moody's Investors Service. Fewer restrictions on employees' choices of hospitals and the completion of Y2K compliance is also expected to bode well for nonprofits.