Regional Health-Care Forecast is Fairly ‘Rosy’: But, Report Says, Trend of Transparency Likely to Benefit Health Plans

By Stacey Burling, The Philadelphia Inquirer

Jun. 14–The trend toward more public information about medical cost and quality, combined with the pending merger of insurers Independence Blue Cross and Highmark Inc., ultimately will tip the balance of power here toward health plans, a Duke University health expert told area medical leaders yesterday.

For the time being, though, “we foresee generally rosy conditions for health systems, hospitals and physicians,” said Christopher J. Conover, an assistant professor at Duke’s Center for Health Policy. He presented a new report on regional health care produced by HealthLeaders-InterStudy, which studies managed health care.

Conover spoke at the National Constitution Center at a meeting sponsored by PricewaterhouseCoopers L.L.P.

Patient demand for Philadelphia’s unusually large number of academic medical centers has given the hospitals more power than usual for such a consolidated insurance market, he said. Insurers have been unable to exclude those hospitals, often known for both high quality and high prices, from their networks because of their popularity, he said.

As patients and employers learn more about the cost and quality of different institutions, they may be more willing to try hospitals with lower prices, he said.

The report looked at health services in 11 counties in Pennsylvania, New Jersey, Delaware and Maryland. It found:

The health systems with the most market share are Jefferson, 19 percent; Catholic Health East, 11 percent; University of Pennsylvania, 9 percent; Christiana Care, 7 percent; Temple University, 6 percent; and Virtua Health, 6 percent.

Independence Blue Cross has 46 percent of the commercial HMO market, and Aetna has 18.6 percent.

Net income for Pennsylvania HMOs rose from $242.3 million in 2003 to $502.8 million last year.

Philadelphia has 121.7 physicians per 100,000 residents, 25 percent more than the national average.

Contact staff writer Stacey Burling at 215-854-4944 or sburling@phillynews.com.

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