United to Shift its Members to Blue Shield

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San Diego Union-Tribune

The 225,000 members of United Healthcare, a subsidiary of the United Health Group, will be moved to Blue Shield of California, the companies announced yesterday.

The $40 million deal covers members in United Healthcare’s HMOs, preferred-provider organizations and point-of-service plans. But the deal does not affect members of AARP in California who have their Medicare supplement through United.

The transfer is expected to begin by the end of the year.

The agreement needs approval from the newly minted state Department of Managed Care, which will review it to determine whether coverage of those being transferred will be disrupted, said Daniel Zingale, director of the agency.

As part of the deal, Blue Shield will provide access to its network of 42,000 physicians and medical facilities to Uniprise, a wholly owned subsidiary of United Health Group serving about 700,000 employees and dependents in the state.

United, a for-profit company, has 9,000 members in San Diego who will be affected by the deal. Blue Shield, a nonprofit, has 135,000 members in the county.

Saying that the decision is consistent with similar moves made recently in Oregon and Washington, United spokesman Roger Cruzan said it is not an indication that United will be withdrawing from California. The part of the business being sold broke even last year, Cruzan said.

“We want to focus our energy on a market that we can serve better,” he said. The transfer affects small-to midsized employers with 2,000 or fewer employees and dependents enrolled in a United health plan product.

A consumer group, nonetheless, criticized United for treating its patients as a commodity to be traded.

“United Healthcare has aggressively advertised that it was unique because doctors are in control of care,” said Jamie Court, advocacy director of the Foundation for Taxpayer and Consumer Rights, based in Santa Monica. “Clearly, United Healthcare’s promises will be be broken if the company is allowed to push patients into Blue Shield, which has different corporate policies.”

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