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Health Net to Expand Coverage for Cross-Border Care

September 11, 2004|Debora Vrana | Times Staff Writer

U.S. health insurers are stepping up efforts to snag Latino business -- on both sides of the border.

The latest move came Friday, when Woodland Hills-based Health Net Inc. said it would expand its cross-border insurance program, which allows members to use their coverage to pay for medical care in both the United States and Mexico, with a new initiative targeting small and mid-size Latino businesses in East Los Angeles.

The Latino community "is ready for healthcare coverage" in this fashion, said Herman Wright, Health Net's director of emerging markets. "Our program helps people who live in the U.S. and who want access to healthcare in Mexico."

Other insurers are following suit. Blue Shield of California, the third-largest managed-care program in the state, in 2001 introduced its own cross-border insurance program, Access Baja, and has since expanded it to cover not only workers but also their dependents.

Access Baja has 2,000 members. And "it continues to build," said Elise Anderson, a spokeswoman for San Francisco-based Blue Shield, "as more companies here search for the best coverage they can" for employees who seek care in Mexico.

In fact, thousands of Latinos in Southern California turn to Baja California for healthcare, saying they like the lower costs and the cultural and linguistic compatibility.

Numbers are difficult to track, but surveys have estimated the state's uninsured population at 4 million to 6 million -- with Latinos making up a significant percentage.

"All these insurers want to expand their membership base, but the good pickings are gone," said analyst David Toung of Argus Research in New York, who has a "sell" rating on Health Net's stock.

"Now you're going to target people who are underinsured or uninsured. The trick for Health Net is to set premiums so they will make a profit."

Health Net could use a boost. Last month, the company said its quarterly profit fell 45%, missing Wall Street expectations, as the health insurer lost members because of premium hikes. Its overall enrollment declined about 3% to 3.76 million.

The company's latest cross- border insurance initiative, part of its Salud con Health Net program, will be administered through a newly formed partnership. Joining with it is City of Commerce-based AltaMed Health Services Corp., a nonprofit company that runs community health clinics. Also on board is the East Los Angeles Doctors Hospital, which counts 200 physicians in its ranks.

Health Net didn't release details on premiums or coverage levels for the new plan.

"We have deep roots in the community here and really focus on preventive care," said Castulo de la Rocha, president of AltaMed, formerly La Clinica Familiar del Barrio.

"With that focus, we can keep people out of the emergency rooms and the hospitals and keep costs down."

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