Blue Cross and Blue Shield of Maryland has stepped up its participation in the Medicaid health program for the poor, enhancing the company's experience in what is expected to be a $1 billion market.
President and Chief Executive William L. Jews and state Secretary of Health Martin P. Wasserman announced an agreement yesterday giving Blue Cross' FreeState health maintenance organization authority to sign up Medicaid beneficiaries.
The contract won't be lucrative in the short run. Under current rules, HMOs must recruit Medicaidbeneficiaries one by one, without state help, a time-consuming procedure that has fostered alleged marketing abuses by other insurers.
But Blue Cross and its competitors are looking forward to 1996, when the state hopes to have federal approval to place all 467,000 Medicaid beneficiaries in HMOs and other managed-care programs. That would generate $1 billion a year in state payments.
Currently, Medicaid beneficiaries may enroll on a voluntary basis in approved HMOs. About 120,000 have done so. Others obtain services by showing their medical assistance card to doctors and hospitals.
Next year, if the Health Care Financing Administration approves, the state would require beneficiaries to sign up for an HMO or managed-care plan, making enrollment much easier for insurers.
Blue Cross, the state's largest health insurer, now has two ap
proved HMOs, which will give it valuable experience in serving a population that has economic and social problems complicating delivery of health care.
About 4,000 Medicaid beneficiaries are enrolled in Blue Cross' Columbia Medical Plan. Mr. Jews said he couldn't predict how many Medicaid beneficiaries might be signed up by FreeState.
FreeState will market its services throughout the Baltimore area, the Eastern Shore and Prince George's and Montgomery Counties.
The addition of FreeState brings to six the number of HMOs serving Medicaid beneficiaries. Other insurers participating are Prudential Health Care Plan, Chesapeake Health Plan, Total Health Care and Optimum Choice, a division of Mid Atlantic Medical Services Inc.
Dr. Wasserman said HMOs areselected for their "willingness and ability to take on some of the more difficult problems," such as AIDS, substance abuse, coronary disease and diabetes.
The state also expects to save money. It pays HMOs about $180 a month per beneficiary, 6.5 percent less than the state pays for beneficiaries who aren't enrolled in HMOs.
Mr. Jews said Blue Cross would provide "high-quality medical services" and "control costs in the right way."
Blue Cross announced last month that Columbia Medical Plan received top marks from an independent quality monitor, the Delmarva Medical Foundation for Medical Care Inc., for its services to Medicaid beneficiaries.
Dr. Wasserman pointed out that Columbia "did very well in past reviews" of HMO marketing activities, distinguishing Columbia from some of its competitors.