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Group Health closing CdA site

Tue., June 14, 2011

Medical center employs 30, serves 3,200 patients

Group Health Cooperative is closing its Coeur d’Alene Medical Center after failing to attract adequate numbers of patients.

In a letter to patients, the Seattle-based organization said that “organization efforts to grow our enrollment have not been successful, and we have determined that the Coeur d’Alene Medical Center is not on a sustainable path.”

Dr. Tom Schaaf, Group Health’s regional medical director, said the clinic has struggled to remain financially viable for years.

“We kept it open because our doctors were committed to it,” he said.

Group Health – which has earned national accolades as a model for reform – is unable to operate the same integrated care strategy in Idaho that has made its business so successful in Washington.

Idaho’s “willing provider” laws ensure that insurance companies allow their customers to use any licensed provider who agrees to a contract and payment system.

The law effectively turned Group Health into an insurance company rather than a managed care network, Schaaf said. And that hampered Group Health’s ability to manage its patient costs, quality and services, he said.

Furthermore, Group Health recently lost some of its larger contracts with employers in Kootenai County, such as the contract with North Idaho College.

Wade Larson, human resources director for NIC, said Group Health offered great coverage. But the college had an unexpectedly high number of ill employees last year, and Group Health’s risk calculus deemed a 14 percent rate increase was required.

NIC shopped around and instead signed with Regence Blue Shield at a $500,000 cost savings, Larson said.

Schaaf noted that knife maker Buck Knives, of Post Falls, also left Group Health for another carrier.

Though its medical center is closing, Group Health will continue to offer health insurance plans in Kootenai and Latah counties through its Group Health Options, Inc.

The closure will not affect patients who have Group Health insurance but see an independent doctor.

They will, however, need to find services such as pharmacy, vision, lab work and radiology at another provider.

The medical center employs 30 medical professionals and serves 3,200 patients, including 1,700 who are Group Health members and 1,500 patients with other insurance, according to a news release. It will close Nov. 4.

Schaaf said Group Health isn’t able to shrink its clinic to find the right mix of service and cost control.

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