Thousands of Tennessee state employees and educators could face a tough choice when picking their health plan this month: Pay cheaper monthly insurance premiums or stay loyal to their regular physician.
In Hamilton County, almost 6,500 state employees - as well as local educators and government employees who choose the state health plan - now have two new health plan choices. One option, BlueCross BlueShield of Tennessee's network S, does not include any Memorial Hospital facilities or providers, nor some of the most popular physician groups in the area. Primary care group Beacon Health Alliance, Highland Pediatrics and the Chattanooga Heart Institute are not in the network.
State employees previously had the option of BlueCross network P, a more costly but broader network that includes nearly all local providers, local insurance agents said.
The second option on the state plan is Cigna's Open Access Plus, which includes Memorial and most of the physician groups not in network S.
The state-level switch will have more dramatic consequences for workers in Chattanooga, local insurance agents said.
In other parts of the state, "you don't have big gaps in primary care physicians or hospitals," said David Wills, a independent local insurance agent. "In Chattanooga, it's more of a big deal."
Erlanger and Parkridge Health Systems are included in network S, which has cheaper monthly premiums for patients but lower reimbursements for providers, which means fewer providers participate in the network.
Patients who go outside their network for health care will face expensive out-of-network costs.
Chattanooga Heart Institute is not part of network S due to reimbursements that average about 10 percent below those of network P, institute President Paul Farmer said.
"It is a lower-reimbursement network and, for us, we feel like it can affect quality of care and the quality of the services that can be provided," he said.
Tennessee leaders are hoping the insurance move will allow the state to restrain rising health care expenditures and keep growth in benefits spending to the 3 percent increase budgeted by the state for this year, said Joe Burchfield, spokesman for benefits administration in the Tennessee Department of Finance and Administration.
CONCERN AMONG EMPLOYEES
Local physicians who aren't in the S network are reaching out to patients who will be affected by the change, telling them they should choose the Cigna plan to keep their physician in-network.
"I wouldn't want them to find out the hard way. It could be disruptive, and we want to do whatever we can to help minimize that disruption," said Dr. Collin Cherry, internist with Beacon Health Alliance. Beacon is not part of network S, except for its OB-GYNs.
This week, Memorial Hospital leaders sent a similar letter to 3,500 Memorial patients who are Tennessee state employees or educators and would be affected, said Jim Hobson, president and CEO of Memorial.
"We were just trying to minimize that confusion and make sure that our patients, when they get to the enrollment period, are able to make the correct choice," Hobson said.
The major hospital provider for network S has "flip-flopped" in recent years between two local competitors, Wills said.
Memorial stopped participating in network S in 2008, the same year Erlanger became a provider for the network. The move opened the door to bring more insured patients to Erlanger, officials said at the time.
Erlanger then shifted its own employees' health plan to network S in 2009 in order to drive more employees to get treated at the hospital and to save 3 percent on employee benefits expenses, officials said.
After hearing feedback from employees, Erlanger eventually allowed employees to pay a higher premium to maintain the network P group of doctors, but 85 percent of hospital employees ended up choosing network S anyway, said Gregg Gentry, senior vice president of human resources at Erlanger.
"There was a level of concern initially but, as they've moved through this first year, I think they've found their access to all care they may need," he said.
Galen Medical Group opted last year to become part of network S in order to keep treating its longtime patients who were Erlanger employees but chose the more affordable premium, said Debra Franks, office manager at Galen OB-GYN.
"The doctors had a large group of Erlanger patients that they didn't want to put out in the cold," she said.
Last year, the state paid $1.3 billion in medical claims, about $10 million more than the state collected in premiums that year, Burchfield said.
With the state's insurance contracts set to expire this year, officials sought more affordable benefits options during its call for new contract proposals, he said.
"Not only do we want to keep costs affordable for members, but we only have a certain amount of money we can spend from the state," he said. "Network S is not as large at network P, but it does meet the state's access standards. ... We are, of course, encouraging everyone to look at networks when they make this decisions and be sure their preferred provider is in that network."
The provider network for Cigna is "extensive" and, like BlueCross' network P, includes almost all providers in the state, Wills said.
In East Tennessee, enrollees in network S would get monthly premium savings of $10 for individual plans and $20 for family plans, according to the state.
Chattanooga employers choosing network S usually get premium discounts of 16 percent compared to network P, said Katherine Young, an account executive with the insurance broker BB&T Huffaker and Trimble.
"The S network has the same plan design, it just has a more restrictive network," Young said. "For people that are healthy and aren't seeing (specialists) all the time or aren't very picky, they can go in S and be fine."