Meadowlands Hospital unveils insurance plan [The Record (Hackensack, N.J.)]

April 09--Meadowlands Hospital Medical Center in Secaucus on Monday launched a health insurance plan that offers coverage to local residents and businesses who choose to rely on the hospital and its doctors for almost all health care services.

The announcement came less than a week after the hospital was sued in federal court by unionized employees who said it had not paid their health claims.

Called TruPlan, the plan expects to charge 25 percent to 30 percent less for coverage than conventional health plans, said John Marshall, the plan administrator.

There will be "no deductible or out-of-pocket expenses for most office visits, treatments and services," the announcement said. However, there will be little or no payment for services provided outside of Meadowlands Hospital or its staff doctors' offices, except for organ transplants or open-heart surgery, procedures that are not offered in Secaucus.

The potential customers, to be located within 10 miles of the hospital, include hourly warehouse employees or part-time workers at the Meadowlands Sports Complex who lack insurance, as well as the town of Secaucus's part-time employees and volunteer firefighters who don't receive coverage from the municipal government. Existing insurance coverage for town employees through the state health benefits plan will not change, said Mayor Michael Gonnelli.

"Hopefully this will be a great option for people who can't get insurance, or who can't afford to have insurance," said David Drumeler, the Secaucus town administrator, who is a member of the board of the new health plan.

The hospital has faced increasing scrutiny from regulators in recent months. Last week, its for-profit owners, MHA LLC, paid off the second of two liens totaling $4.4 million from the Internal Revenue Service for non-payment of withholding taxes. The hospital earlier this year paid a $6,000 fine to the state Health Department and owes $6,000 more for failure to file a required audited annual report that was due June 1. Several other reports required as a condition of state approval for the hospital's sale in December 2010 also have not been submitted, according to an April 2 letter from John Calabria, a Health Department director.

Marshall said the hospital has "invested a lot of money shoring up for the [insurance plan] -- $9 million or $10 million in new doctors and new equipment."

TruPlan is what's known as a Multiple Employer Welfare Arrangement, or MEWA. It is sponsored by Meadowlands Community Healthcare Trust and the hospital.

Employers pool their premiums to pay for health care and the hospital provided initial capital of $200,000. The hospital will provide "90 percent of the services," Marshall said, receiving a set fee per member, without issuing bills for the care it offers.

The arrangements are an alternative to traditional insurance markets, especially for smaller-sized employers. They can charge lower premiums because they face different regulations, said Ward Sanders, president of the New Jersey Association of Health Plans. "For example, they don't pay premium taxes to help fund programs such as charity care ... nor are their networks likely to be as comprehensive," he said.

The Insurance Department approved the Meadowlands plan in January, after considering it as "a completely separate issue" from the Health Department's enforcement actions against the hospital, said Marshall McKnight, an insurance spokesman. "The MEWA is not being guaranteed by Meadowlands Hospital," he said. "It's well capitalized. It met the qualifications."

In the past, such plans were at greater risk of insolvency when claims suddenly spiked or exceeded the ability of the plan to pay them, according to a study by the Commonwealth Fund, a health policy think tank. In 2002, the New Jersey Coalition of Automotive Retailers, a long-standing Multiple Employer Welfare Arrangement, went belly-up, leaving 20,000 people without coverage and $15 million in unpaid medical claims.

TruPlan hopes to enroll about 10,000 people within its first year, Marshall said. Its application projected 3,750 subscribers by year's end.

Email: [email protected]

___

(c)2013 The Record (Hackensack, N.J.)

Visit The Record (Hackensack, N.J.) at www.NorthJersey.com

Distributed by MCT Information Services