Health Plans To Be Pared Down

Harvard will consolidate health plans for employees from four administrators to two beginning July 1, the University announced last month.

The two plans to be dropped—Blue Cross Blue Shield of Massachusetts and Tufts Health Plan—together enroll 19 percent of employees, but University officials said the transition will cause “minimal disruption” because of the plans’ similar structures.

“Health benefits are not changing,” said Peter V. Marsden, who chairs Harvard’s advisory committee on health benefits. “What’s covered, what’s not covered, what the co-payments are—all those provisions are identical to what people have received in the past few years.”

Employees enrolled in the Tufts or Blue Cross plans will be automatically moved to one of the remaining plans—Harvard Pilgrim Health Care or the Harvard University Group Health Plan.

The two retained plans already cover over 99 percent of physicians included in the Blue Cross and Tufts plans, and Harvard Pilgrim has already begun trying to recruit the physicians that don’t overlap, according to Dawn M. Socha, Harvard’s director of benefits.

“We are hopeful no one will need to change providers as a result of this,” Marsden said, “and we are virtually certain that few, if any, people will be obliged to change providers.”

Socha said that the University’s Benefits Services Group has received an average of about 10 phone calls each day since the change was announced to inquire about its effects on their coverage.

The move comes as part of a University effort to increase efficiency in health care administration, according to Socha, who cited a consolidation of pharmaceutical benefits management announced last year that will save $6.3 million over three years.

Socha added that she expects the health plan consolidation to cut Harvard’s health care spending by $6.5 million over the same period, lowering or stabilizing premiums while introducing new benefits, such as a 24/7 nurse hotline and programs for pregnancy, oncology, and renal disease.

Harvard decided to choose Harvard Pilgrim after soliciting proposals for consolidated coverage from its three current plans other than Harvard University Group Health Plan and from Aetna Inc, another health care benefits company.

Aetna came out ahead in the comparison, conducted with the help of consulting firm Hewitt Associates, but the University chose Harvard Pilgrim because of its local roots, according to Socha.

“Aetna is not a regional brand,” she said. “Harvard Pilgrim came in second and it was close enough that we decided the local brand made sense.”

—Staff writer Clifford M. Marks can be reached at cmarks@fas.harvard.edu