Wisconsin’s largest HMO is dropping out of the state employee health plan, saying that continuing would not be economically feasible.
PrimeCare Health Plan, a unit of United HealthCare Corp., had proposed a 19-percent premium increase for state workers in 1999, but on Sept. 1 told the state that it was dropping out, effective Jan. 1. Meanwhile, other HMOs in the program increased premiums by an average of 9 percent for next year.
The state program covers about 210,000 people, and this year offers 21 HMOs and two indemnity plans. The state pays HMOs a rate equal to 105 percent of the lowest-cost HMO in each county, and employees pay the balance of the premium.
The state’s contribution is not adjusted to reflect the health risk of participants, and PrimeCare has calculated that the 2,500 state workers in its plan carry risk that is 30 percent greater than the group as a whole. PrimeCare, which has more than 210,000 enrollees, is also dropping out of the Federal Employees Health Benefits Program in the state, citing reasons similar to those that led it to exit the state plan.
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