Harmony Health Plan of Illinois Inc. is expanding its Medicaid managed-care business into northwest Indiana in a move that could boost the Chicago-based insurer’s number of enrollees in a short time.
With 39,000 enrollees, Harmony has Illinois’ second-largest Medicaid HMO, but the managed-care plan’s enrollment here has been flat in large part because the state hasn’t made enrollment mandatory, as have other states, industry analysts say.
Unlike Illinois, Indiana has some mechanisms for steering people who are insured by its federal/state health insurance program for the poor into managed-care plans.
In Illinois, such HMO-style Medicaid plans were expected to be the model seven years ago when then-Gov. Jim Edgar introduced Mediplan Plus, an effort to require most of the state’s more than 1 million Medicaid recipients to enroll in HMOs run by insurance companies or medical-care providers.
But because neither Edgar nor the current administration of Gov. George Ryan made Medicaid managed care mandatory, only about 10 percent of the state’s 1.4 million Medicaid recipients are now enrolled in an HMO.
With such a small pool of Medicaid recipients to draw from, smaller plans left the program or merged with larger players because they weren’t getting enough subscribers to pay medical-care costs and expand their business.
Now, Harmony is one of only six Medicaid managed-care plans in Illinois, compared with 16 five years ago.
Harmony will remain in the Illinois Medicaid business, but executives see its biggest growth opportunity across the border in Indiana.
“It is possible that Indiana is the tail wagging this dog here,” said Harmony President Ancelmo Lopes.
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Harmony will compete with three other insurance companies that won state contracts to provide managed-care services to 300,000 Medicaid recipients in northern Indiana. Harmony is the only Chicago-based plan to participate.
Harmony is currently negotiating contracts with 100 northwest Indiana physicians who provide medical care to 80 percent of the estimated 50,000 Medicaid recipients in Lake County, Ind.
Doctors are key to a successful Medicaid managed-care plan in Indiana because patients must sign up for an HMO through their physician. In Illinois, plans market to individuals.
“Physicians also have an opportunity for enhanced reimbursement against the [traditional Medicaid] fee schedule,” said Robert Currie, Harmony’s vice president in charge of Indiana operations. “There are also patient services, like free 800 voice mail for every enrollee, which provides a new communication link for the doctor.”
Closer contact: Although Chicago recently has lost a few corporate headquarters, the city still is holding its own as a national base for the health-care industry and its associations.
In fact, the Society of Critical Care Medicine is in the process of relocating to Chicago from Anaheim, Calif., to be closer to other medical organizations based here.
The group, which represents 10,000 intensive care physicians, nurses and other professionals, is temporarily set up on the second floor at One East Erie until permanent offices can be located.
“The society has had more and more interaction with other medical societies, like the American Medical Association and other groups that are here, so we will be improving that access,” said David Martin, the society’s chief executive.
Only 11 of the society’s 40-member staff has relocated to Chicago so far, but the society will be closing the Anaheim office by June 2002. Martin is hiring new staffers and working on convincing others to follow him to Chicago.
“I can’t convince them that the weather is nice,” Martin said. “But there are no rolling blackouts or earthquakes here.”
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