Ten big corporations are banding together to find the best health maintenance organizations for their employees.
The National HMO Purchasing Coalition will choose HMOs for 600,000 workers and dependents in 27 different state and metropolitan areas.
Sponsors said Monday that the coalition’s size will give it the clout to closely examine the operations of the HMOs, check medical records and survey patients to make sure they get the best quality care at the least cost.
The coalition is an outgrowth of a similar effort begun in 1993 by two of the 10 companies, American Express Co. and Merrill Lynch & Co.
While it is common for companies in local areas to band together to buy health care services, this is believed to be the first such organization that is national in scope. Collectively the companies spent about $1 billion in health benefits last year.
Others joining the effort are International Business Machines Corp., ITT Corp., Marriott International Inc., Nabisco Brands Inc., Pfizer Inc., Sears, Roebuck and Co. and two others who refused to be named.
LouAnn Cash, vice president of benefits planning for American Express Co., said the original partnership was an outgrowth of frustration over the way that HMOs promote their services.
Most HMOs do a good job in preventative medicine such as cholesterol screening and mammograms to prevent breast cancer, she said.
However, patients are often concerned about how they’ll be treated when they’re sick because HMOs keep their costs down by rewarding doctors and hospitals for using fewer services.