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INSURANCE PLAN AVAILABLE FOR SMALL FIRMS

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Small businesses and an estimated 58,000 employees previously unable to afford health insurance now have a new, low-cost option.

The Utah Community Health Plan, which will offer premiums about 40 percent lower than the current market rate, was unveiled Wednesday morning.The plan is designed for Salt Lake County families in which one or both parents is employed by small companies that don't provide medical coverage. Companies with fewer than 20 workers will be eligible.

The plan is supported by the Salt Lake Community Health Centers, Holy Cross Hospital, University Hospital, Intermountain Health Care and two IHC hospitals - LDS Hospital and Primary Children's Medical Center.

"Generous discounts from hospital and physician specialists coupled with strong utilization management and user co-payments make this plan economical," said Dr. David A. Burton, IHC's vice president for research and development.

Additional support is being offered by a two-year, $275,200 grant from the Robert Wood Johnson Foundation of Princeton, N.J., and a $375,000 grant from the IHC Foundation of Salt Lake City.

The plan, praised Wednesday by community and health-care officials, is long in coming.

It was in 1986 that the Health Care Access Steering Committee, a group of local community and health-care leaders, identified the growing problem of the working uninsured as a critical local issue. They suggested that IHC apply for a study grant.

The next year, IHC received and matched a grant from the Robert Wood Johnson Foundation.

But even that didn't guarantee unanimous support. IHC had local critics - insurers who feared that the corporate giant might be treading on their turf.

"Because of the uniqueness of the program and because it was going to involve rates considerably less than market, IHC agreed to an informal hearing with industry members who write policies for small groups," said State Insurance Commissioner Harold C. Yancey. "The general response of the industry as a result of the hearing was guarded.

"They could see some possible inroads being made into their territory. At the same time they realized there is a small group market that needed to be addressed by somebody, and they were not always addressing it."

Yancey said it's common knowledge among insurance companies that small group policies aren't always profitable.

"In fact, if you write just small groups, you are going to lose your shirt," Yancey said.

To appease concerned insurers, IHC made some concessions - namely strict underwrites and sizeable co-payments.

The newly announced plan, Yancey noted, also doesn't cover exotic medical procedures such as heart transplants.

The plan still isn't without critics.

"But the industry has now settled down a little bit and has realized it is targeting a very special market with limited numbers," Yancey said. "They (insurers) have decided that they won't lose a lot of business because of this program."

The commissioner tags the plan "a little bit experimental."

"But it's an area where we do need to do some experiments because we need to find some answers in this area," he stressed.

The plan's sponsors agree.

"The Utah Community Health Plan demonstrates what one community can do to solve the chronic problem of the working uninsured," said Mike Stapley, vice president of operations for Deseret Mutual Benefit Association, and chairman of the Health Care Access Steering Committee.

"It may prove to be a blueprint for others."

The program expects to enroll 3,000 members during its first year of operation.

Initially, officials said, it will serve only small businesses in Salt Lake County and southern Davis County. Eventually the plan is expected to break even and not require grant support.

Interested owners of small businesses can contact the Utah Community Health Plan at 973-9741.