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2 Groups Freeze HealthNet Use After Lapse in Accreditation


HealthNet, the managed-care division of Woodland Hills-based Foundation Health Systems, has opted out of a highly regarded accreditation program, prompting some of the state's largest employers to freeze membership for their workers in the HMO.

Two huge purchasers of health care, the Pacific Business Group on Health and the California Public Employees' Retirement System, said they will monitor the quality of care received by HealthNet members until accreditation is reinstated.

"We consider this a serious issue," said Bruce Smith, health-care team leader for Chevron Corp., which is freezing enrollment in HealthNet as is Safeway Inc., Stanford University and APL Ltd. "Our goal is to provide high quality, cost-effective health care for our employees, retirees and their families, and accreditation is one of the main standards we use to evaluate health plans."

HealthNet chose not to apply for accreditation by the National Committee for Quality Assurance this year, because the documentation required for the application had not been properly maintained during 1999, when the company underwent a change of management, said Jennifer Gutzmore, HealthNet's medical director.

Accreditation through NCQA is a voluntary process that many consumer advocates and employers believe is key to ensuring that HMOs provide high quality care to members.

HealthNet's decision comes at a time known as "open enrollment," when many workers are presented with employers' options for health benefits.

CalPERS has highlighted HealthNet's lack of accreditation on its Web site, and had sent letters to its 235,000 members who are enrolled in HealthNet plans.

"CalPERS is very concerned that HealthNet no longer has NCQA accreditation," said CalPERS health benefits executive Allen Feezor. "We are also working to affirm that HealthNet's quality of care is maintained while they're seeking to regain accreditation."

HealthNet officials expressed surprise at the response, saying that the company offers quality health plans that have won high marks from several nonprofit organizations that rate HMOs.

To receive accreditation, the NCQA requires health plans to keep records for three years, tracking such things as whether women are reminded to get mammograms or parents sent letters urging them to immunize their children.

In addition, the organization examines consumer and medical group satisfaction surveys, and quality ratings from other organizations.

Concerned that "we would not be able to tell our side of the story" and that accreditation might be denied, HealthNet chose not to apply.

"Quite frankly, where we could not find the history, we had to re-create it," Gutzmore said. "We took stock in February and gave them our recommendation that we should spend more time and postpone the [application]."

But, she said, that was no reason to believe that quality at the company's health plans had slipped.

HealthNet plans to apply for accreditation next year, Gutzmore said, and notified employers and other purchasers of its decision.

But Peter Lee, executive director of the Pacific Business Group on Health, which works with the state's large employers in negotiating health-care rates, said employers were correct to be concerned that HealthNet had not applied for accreditation.

"Purchasers are saying that they will step up to the plate when health plans appear to be backtracking away from quality," Lee said.

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