What to Ask Your HMO.

The world of managed care, and HMOs specifically, has evolved quickly and as a result, each HMO offers different services and benefits. Even the operating procedures and management models differ from HMO to HMO -- sometimes dramatically. For consumers, it can be difficult to discern which HMO is "the right one" and offers the benefits that will serve their specific needs. Often, individuals are perplexed as to which are the right questions to ask their HMO.

It's important to have a list of questions that pertain specifically to your needs -- not only when you are selecting the HMO but also after you have become a member. Too many individuals become members of HMOs without obtaining a clear understanding of what their benefits are and how they can be accessed. This problem can be remedied by calling the member services representative at the HMO and asking for clarification.

Outlined below is a list of questions that individuals should consider asking to either: a) help decide which HMO is right; or b) better understand the benefits available to them at their current HMO. With the competitive nature of HMOs in Southern California today, the answers to these questions may vary greatly from HMO to HMO.

Question number 10 may seem somewhat trivial to many, but knowing whether or not your HMO is an IPA Model is an important factor in the complete understanding of the benefits available to you.

The IPA Model Defined

Non-profit Inter Valley Health Plan is an example of an IPA Model HMO, but what does that mean, exactly?

All HMOs are basically varying forms of health insurance in which members prepay premiums for health services, which generally include inpatient and ambulatory care. For the patient, it means reduced-out-of-pocket costs (i.e.: non-deductible), no paperwork (insurance forms) and only a small copayment for each office visit to cover the paperwork handled by the HMO. Within the basic HMO definition, there are a number of different models of HMOs.

Plans such as Inter Valley Health Plan have been labeled as IPA Model HMOs because, in Inter Valley's case, the Plan contracts with IPAs or Individual Practice Associations. In IPA Model HMOs, the Individual Practice Association is a management entity that holds contracts with individual providers who work in their own private practices and see fee-for-service patients as well as HMO enrollees. The HMO pays the PA an agreed-upon dollar amount (capitation), to provide designated medical services for a set period of time. The IPA in turn will "sub-capitate" providers, or pay providers on a reduced fee-for-service basis to provide the designated medical services.

"Capitation" refers to a per member, monthly payment to a provider that covers contracted services and is paid in advance of its delivery. In essence, a provider agrees to provide specified services to plan members for this fixed, predetermined payment for a specified length of time (usually a year), regardless of how many times the member uses the service. The rate can be fixed for all members or it can be adjusted for the age and gender of the member, based on actuarial projections of medical utilization.

"Fee-for-Service" refers to a traditional provider reimbursement in which the physician is paid according to the service performed. This is the reimbursement system used by conventional indemnity insurers.

The IPA Model allows community physicians to remain independent in their own practice yet compete for HMO business. Inter Valley was originally formed by Pomona Valley Hospital and the local community physicians as a means to compete in the growing HMO market place.

Physicians belonging to an IPA guarantee that the care needed by each patient for whom they are responsible will fall under a certain amount of money. They guarantee this by allowing the HMO to withhold an amount of their payments -- usually about 18-21 % per year. If by the end of the year, a physician's cost for treatment falls under this set amount, then the physician receives his entire withhold fund. If the opposite is true, the HMO can withhold any part of this amount, at its discretion, from the fund. Essentially, the physician is put "at risk" for keeping down the treatment cost. This is the key to an IPA Model HMO's financial viability.

Over time, Inter Valley has diversified its contracted provider network to include not only IPAs but also medical groups. Medical group models usually employ the primary care physicians and some specialists and deliver the services at one clinic site or multiple clinic types. Adding medical group models to the provider network allowed Inter Valley to compete in the employer group marketplace by offering varying types of health care delivery models. So while Inter Valley is officially an IPA Model HMO, they might be better described as a mixed model" HMO.

Cyndie O'Brien is director of corporate communications for Pomona-based non-profit HMO, Inter Valley Health Plan.

Questions to Ask

* Once I have selected my Primary Care Provider (PCP), can I change to another at a later time?

* How do I get a referral from my PCP to a specialist?

* What is an "express referral?" Does this HMO offer such a service?

* If my dentist gives me a prescription, is it covered by this HMO?

* Does this HMO have a formulary?

* Do I need authorization for certain drugs?

* Am I covered by this HMO when I'm travelling?

* What action can I take if I am unhappy with a decision a doctor makes?

* Does this HMO have high member satisfaction? (This can be checked by reviewing recent scores made available by the Pacific Business Group on Health. Member satisfaction and Quality of Care scores are the most important. Look for HMOs that regularly score among the top five in both categories.)

* Is this Plan an IPA Model HMO, or some other model? HOW does the difference affect the way I am served?