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By M. PAUL JACKSON michaelj@leader.net
Friday, March 21, 2003 Page: 1C
WILKES-BARRE – Health Net Inc.’s announcement this week that it will no
longer offer managed-care insurance in Pennsylvania is bad news for the
company’s nearly 26,000 Luzerne County members.
But, for Health Net’s two largest competitors, the announcement could be
good news.
Blue Cross of Northeastern Pennsylvania and the Geisinger Health Plan could
benefit by picking up the business of former Health Net members.
Health Net subscribers will receive information soon on their choices, Blue
Cross spokesman Gerry Snyder said Thursday.
Snyder could not say how many new members Blue Cross could receive. “We
will obviously be an option for them to look at,” he said.
Health Net, based in Connecticut, was unable to stay competitive in
Pennsylvania because it had too few members, spokesman Ira Morrison said.
“We just didn’t have the market share to allow us to negotiate better
rates and to drive down costs to our members,” he said.
The bulk of the company’s 32,000 Pennsylvania members were in Luzerne
County. Other members were located in Lackawanna County and the Philadelphia
area.
Most of Health Net’s Pennsylvania subscribers will lose coverage at the end
of September.
The company also insures post office workers through the Federal Employee
Health Benefit Plan. Those workers will receive Health Net coverage until Dec.
31.
“It’s certainly a possibility” that Geisinger could pick up more
commercial members, health plan spokeswoman Lisa Hartman said.
“We do have a number of programs that may be of interest to employers,”
she said. “We’ll probably see some inquiries.”
Health Net is the parent company to Health Net of the Northeast, which
insures subscribers in Connecticut, New Jersey and New York. The parent
company insures about 5 million people in 15 states.
Because Health Net had so few local subscribers, it was not able to compete
with Blue Cross or Geisinger, Morrison said. The two companies dominate the
managed-care insurance market in the region.
The two companies “were able to get a better handle on their costs as a
result of” their size, Morrison said. “This was a difficult situation.”
Health Net will maintain a physician network so that subscribers in other
states can receive care in Pennsylvania, according to the company.
M. Paul Jackson, a Times Leader staff writer, may be reached at 829-7134.