Upper Chesapeake joins 2 HMOs Agreement comes on the heels of split with Prudential.

August 15, 1991|By Ross Hetrick | Ross Hetrick,Evening Sun Staff

Upper Chesapeake Health System Inc., a major health-care network in Harford and Cecil counties, has signed with two health-maintenance organizations just two weeks after its sudden break with the Prudential Health Care Plan.

The health-care operation begins service to Chesapeake Health System of Baltimore and Aetna Health Plans of the Mid-Atlantic Sept. 1 -- the day that Prudential ends its relation with Upper Chesapeake.

One of the prime targets for both Chesapeake Health and Aetna will be the 15,000 people who now get their health care through the Prudential plan. Those members of the Prudential plan will have to change their primary doctors by Sept. 1 because of the split between the insurance company and Upper Chesapeake.

"I think we're getting two good arrangements put in place in short order," said Leonard E. Cantrell Jr., chief executive officer of Upper Chesapeake. He said it was important to have the HMOs in place so that applications can be made to federal and state agencies where employees will get a chance to switch to the new HMOs later this year. Several thousand federal and state employees are now part of the Prudential plan.

Cantrell declined to reveal the terms of the agreements with Chesapeake Health and Aetna. He said Upper Chesapeake is also talking to other HMOs and may provide services to one or two more operations.

The split between Upper Chesapeake and Prudential came three months after Prudential, a subsidiary of the giant insurance company based in Newark, N.J., completed its purchase of the Johns Hopkins Health System and inherited a contract with Upper Chesapeake.

Upper Chesapeake also operates the Harford Memorial Hospital in Havre De Grace and the Fallston General Hospital in Fallston. Upper Chesapeake had provided health care to the Johns Hopkins HMO since 1986.

The entire Prudential health plan has 118,000 members in Maryland and much of the care continues to be provided by Johns Hopkins, which has a 10-year contract with Prudential.

Upper Chesapeake has blamed the contract rift on Prudential's insistence that the health-care provider have no contracts with other HMOs. A Prudential official said she did not know why Upper Chesapeake canceled the contract.

As of Sept. 1, the Prudential members formerly served by Upper Chesapeake will be transferred to a network of 33 doctors at

11 locations that were assembled by Prudential. The insurance company said the new arrangement will offer better care than the 11 physicians at five centers operated by Upper Chesapeake.

But Cantrell contends these new doctors will be overloaded because they already have existing practices. In contrast, the doctors in Upper Chesapeake treat HMO patients only.

Current patients will be able to switch back to Upper Chesapeake during annual open enrollment if their employers adopt either Aetna or Chesapeake Health as an option. Many employers offer a variety of HMO options and employees can change these plans during open enrollment periods.

"We're going to make our presence known in Harford County," said Darlene M. Burton, marketing director for Chesapeake Health. "The patients will have to make the decision," she said.

Chesapeake Health, a non-profit group founded in 1976, now has 21,000 members in the Baltimore area. The agreement with HTC Upper Chesapeake would be the HMO's first venture into Harford and Cecil counties. "This is a very key deal for us," Burton said.

The Aetna HMO, which is a subsidiary of the giant insurance company based in Hartford, Conn., is also starting with no patients in Harford or Cecil counties, but it already has contracted with some doctors to provide services, according to Joseph M. Hall, executive director of the Baltimore operation for Aetna Health Plans of the Mid-Atlantic.

"This certainly gives us a network presence immediately in Harford and Cecil," Hall said. "People seem to be attracted to the family health centers [run by Upper Chesapeake]," he said.

The Aetna HMO operation moved into the Maryland and Virginia suburbs of Washington about three years ago when it acquired the Network Health Plan. The company's Baltimore operation started in January.

Aetna has a total of 35,000 people enrolled in its HMO operations in Maryland and Northern Virginia. The HMO is part of a larger managed care program that has 90,000 members, Hall said.

Like Chesapeake Health, Aetna will be mounting a marketing effort to win over employers and their workers in Northern Maryland.

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