A Pilot Light for the Poor : Blue Cross Program Will Provide Low-Cost, No-Frills Insurance

If there’s a health-care “revolution” going on, try telling that to the more than 6.5 million Californians who lack health insurance coverage.

While health-care mergers are announced almost daily, and employers claim victory over out-of-control medical costs, the ranks of the uninsured keep growing. About 39 million Americans lack health insurance--and the percentage of uninsured in Los Angeles County (31%) is worse than in any city in the nation, studies have shown.

President Clinton tried but failed to tackle the problem through comprehensive health-care reform. Meanwhile, experts continue to call on government and industry to do something about this very sticky problem.

Enter Blue Cross of California, which is trying to tackle the problem with a small-scale remedy. In January, the Woodland Hills-based managed-care company will market a new health insurance program that provides limited, no-frills coverage to the working poor.

State regulators recently approved Blue Cross’ proposal for a pilot program in the Boyle Heights neighborhood of East Los Angeles. If the program is successful, the company hopes to expand it to other areas. Medical services will be provided by Family Care Specialists, a Boyle Heights medical group, and White Memorial Medical Center. The Chicano/Latino Medical Assn. of California was also involved in the program’s planning.

The program, called MediFam, targets families earning up to 200% of the federal poverty-level income. For a family of four, that is between $15,000 and $31,000 a year.

“It fills a niche,” says Claudia Harris, program manager for Blue Cross. “The number of uninsured is staggering. But what’s more staggering is the number of uninsured that are in working families that earn too much [to qualify for] Medi-Cal but too little to afford insurance.”

Medi-Cal is what the Medicaid health insurance program for the poor is called in California.

Ron Williams, a Blue Cross executive, touts the program as “an example of how the private sector is trying to address the problem of the uninsured.”

Cost of Coverage

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The MediFam plan will cost a family of four about $80 a month, or nearly $1,000 a year, Blue Cross said. That’s much cheaper than the more than $350 a month such a family would pay for an individual plan offering full benefits.

Blue Cross keeps the cost low by offering stripped-down coverage. MediFam doesn’t pay for hospitalization, outpatient surgery, maternity service, home health services or emergency room care outside of the local area. (Blue Cross executives say hospital and maternity services are available to some low-income families through certain government health programs.)

What it does pay for are routine doctor visits, laboratory tests, local emergency room care and preventive services such as Pap smears and child immunizations.

The program’s affordability “could actually bring some uninsured folks into the market,” said Alan Katz, a Woodland Hills insurance broker. “But it’s not a complete solution” to the problem of reducing the number of uninsured.

Jeanne Finberg, staff attorney with Consumers Union in San Francisco, said it is important that the program’s limitations, such as no coverage for hospitalization or maternity services, be adequately explained to the largely Spanish-speaking population that Blue Cross is initially targeting. She also questioned whether the program would offer “good value” to potential buyers.

“It’s not clear to me it’s a good deal for consumers,” Finberg said, noting the plan’s roughly $1,000 annual expense for a family. “You wouldn’t want to buy it unless you are anticipating spending, say, $1,200 a year” for non-hospital medical expenses.

HMOs Rated on Web

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Consumers who want to find out how HMO members and ratings organizations judge their health plans can turn to the Internet for help.

The Pacific Business Group on Health, a California-based coalition of major employers, has developed a site on the World Wide Web that provides information on how members rate their HMOs, whether health plans are accredited and comparative information on hospitals.

The Web site address is https://www.healthscope.org

David Olmos can be reached by e-mail at david.olmos@latimes.com

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