HealthNet plans to drop Sutter Health from Medicare network

The Associated Press
Wednesday August 29, 2001

SACRAMENTO— HealthNet of California plans to drop Sutter Health from its Medicare HMO network, and will stop paying for Seniority Plus subscribers’ care from Sutter’s hospitals or doctors after Jan. 1. 

The decision could affect about 25,000 seniors using Sutter’s 26 hospitals and 5,000 doctors, said HealthNet spokeswoman Lisa Kalustian. 

Kalustian said HealthNet regrets ending the service, but has been unable to negotiate a new contract with Sutter Health for non-Medicare patients. The company decided to drop Sutter to allow the Seniority Plus subscribers to have time to change insurers before year’s end, Kalustian said. 

“It is based on the necessity to keep health care affordable,” Kalustian said. 

Sutter spokesman Bill Gleeson said the company was disappointed by HealthNet’s decision, which he said could affect other negotiations with the company. 

If Seniority Plus members want to keep their doctors, they will have to change insurance companies or go with a  

more expensive Medicare policy  

from HealthNet. 

“I’ll have to change health plans,” William McCormack, told the San Jose Mercury News. 

McCormack, a retired director of international education at the University of California, Berkeley, wanted to keep seeing his internist of eight years. 

“I’m experiencing feelings of helplessness. The decisions are outside of my own control,” McCormack said. 

HealthNet is not the first insurance company to drop a Medicare HMO as they grow less profitable. 

In some counties, PacifiCare no longer accepts new subscribers to Secure Horizons, the only other Medicare HMO accepted by Sutter. PacificCare also has said it wants to pull out of its managed-care plan in Mariposa, Merced and parts of Madera counties because costs are too high. If it receives approval from the state Department of Managed Health Care, PacifiCare will withdraw its coverage starting Jan. 1. 

Aetna Inc. also recently announced that it intends to withdraw from 11 counties, including Fresno, Kings, Madera, Merced and Tulare.