State Acts to Cut Its Health Bill Officials Hoping Hmos Will Save Millions Each Year

By Virginia Young Post-Dispatch Jefferson City Bureau | St Louis Post-Dispatch (MO), September 28, 1994 | Go to article overview

State Acts to Cut Its Health Bill Officials Hoping Hmos Will Save Millions Each Year


Virginia Young Post-Dispatch Jefferson City Bureau, St Louis Post-Dispatch (MO)


In a move expected to save taxpayers millions of dollars, officials have revamped the health insurance system for state employees and retirees.

Managed care, previously an option only in St. Louis and Kansas City, will be expanded statewide. That means all of the system's 48,000 members will be encouraged to join health maintenance organizations, or HMOs.

Officials say the changes will save taxpayers at least $22 million a year. The Missouri Consolidated Health Care Plan announced the plan Tuesday; it will take effect Jan. 1.

"This process has proven that when we take the proper approach, the health care monster can be tamed," said Mike Wolff, a St. Louis lawyer and chairman of the plan's board.

In a new wrinkle, all public entities - counties, cities, school districts and the like - can join the state plan. That could boost the plan's membership to 450,000 and prove a godsend for small organizations paying high premiums.

"Cities have been extremely anxious for this to get started," said Gary Markenson of the Missouri Municipal League. "We've gotten literally hundreds of calls in the last year."

Jim Stutz of St. Louis, a member of the Consolidated Plan's board and the St. Louis Business Health Coalition, said the plan secured "very attractive premium rates. My hunch is, it would represent significant savings" for many public entities.

"And they're not forced to be in it, so it's the best of both worlds for them," said Stutz.

Here's how the new approach, known as "managed competition," works:

The plan's board divided the state into eight regions and sought bids in each region on a standard benefit package. In each area, the low-bid HMO option will be free to the employee; the other options will carry a price. …

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