New Breed of HMO : Valley Presbyterian in Van Nuys, in conjunction with Maxicare, offers seniors a plan that is based at the hospital.


Call it brand loyalty.

Some seniors, interested in reducing their costs for health care--but not willing to start shopping for a different community hospital or switch physicians--are signing up for a new breed of “private label” health maintenance organization.

Valley Presbyterian Hospital in Van Nuys is the first in the Los Angeles area to offer such a product, called “VPH 65.” The hospital works in conjunction with Maxicare, packaging coverage to make it specific to its San Fernando Valley service area and more palatable to seniors who are wary of large HMOs that may seem impersonal and unresponsive, said Hal Wurtzel, Valley Presbyterian’s vice president of corporate development.

While the idea of marketing an HMO around a single community hospital is new, the trend toward encouraging seniors to convert their Medicare benefits to an HMO is not. More than 600,000 seniors are enrolled in HMOs in California, and 30% of the seniors in Southern California are signed up, said Dr. Arthur Southam, president of CareAmerica Health Plan, owned by UniHealth America in Chatsworth.


Participants--who sign over their Medicare benefits to Maxicare--can choose physicians who are on the medical staff at the hospital. They also can get coverage for dental care, optometry and prescriptions. Because the plan is based at the hospital, members can sign up there and get questions answered or problems resolved through the VPH 65 office on-site.

Eugene Oberle and his wife Mary, both 75, enrolled in the program in January. They were determined to find an alternative to conventional Medicare coverage because its costs were rising rapidly, Eugene Oberle said. Since they had been with their internist for 18 years, the Oberles didn’t want to be forced by a plan to change physicians. “All the doctors we use are in the program, so we didn’t have to select any new ones,” he said.


For Ruth Clary, 73, the chance to reduce her health-care costs was also a prime motivator when she and her husband Charles signed up April 1. She had been paying $239 a month for supplemental insurance. Now she pays only small co-payments for physician visits and prescriptions. “Many of my friends are signing up,” she said. “It’s a booming thing. By having the program associated with Valley Pres, there’s the sense it’s in the family.”


That’s the point. “The idea of intimately involving hospitals in marketing to Medicare beneficiaries in their area is not new,” Southam said. “The hospital is a very important factor in a health plan, and it tends to have pre-established credibility. What’s new is the idea of potentially including the hospital in the name of the program,” he said.

“It’s best thought of as a packaging strategy designed to make the plan appear more locally based and make the hospital and physicians more comfortable getting behind it,” Southam added.

While participants enjoy lower out-of-pocket costs and some enhanced coverage for dentistry, optometry and outpatient pharmacy, they are often required to see a primary-care physician before being referred to a specialist. Some who are accustomed to seeing a cardiologist for hypertension, for example, may find the plan requires that they see a family practice physician instead, Southam said.

But seniors enrolled in VPH 65, or in any of the other competing HMOs, including FHP, Kaiser, HealthNet and Secure Horizons, can end participation at the end of any month. So if the rules of the game are too constricting, participants can quickly opt out.


Where to

What: VPH 65, an HMO for seniors.

Location: Valley Presbyterian Hospital, 15107 Vanowen St., Van Nuys.

Call: (800) 427-3209.