AmeriHealth Mercy set to compete in Medicare/Medicaid dual-eligible plan

AmeriHealth Mercy said Thursday that it has gotten the green light to compete in certain Pennsylvania and South Carolina markets for so-called dual-eligibles, people who qualify for both Medicare and Medicaid.

The new AmeriHealth Mercy plans, known as Medicare Advantage special-needs plans, represent a new business line for the Philadelphia company, which is majority-owned by Independence Blue Cross and provides services to Medicaid beneficiaries in 12 states.

Special-needs plans are supposed to include extra services, such as care coordination, to reduce the cost of care for the beneficiaries, who are poor and often have numerous maladies. About 9 million of Medicare's 48 million beneficiaries are also eligible for Medicaid, a health-insurance program for some low-income adults and children.

The dual-eligible group accounted for just 15 percent of Medicaid enrollment in 2008, but 39 percent of spending, according the Kaiser Commission on Medicaid and the Uninsured.

AmeriHealth's Keystone Mercy Health Plan, a Medicaid managed-care plan, is the biggest in Southeastern Pennsylvania, with 321,000 enrollees in Philadelphia, Bucks, Montgomery, Chester and Delaware Counties, which are among the areas where it will offer the new plans.

"They are aged out of the plan when they reach 65," AmeriHealth executive John Baackes said of those enrollees in an interview. "We thought that by getting into this business we could provide some continuity."

Baackes said Southeastern Pennsylvania has 63,600 people eligible for Medicare and Medicaid but not in nursing homes or other institutions.

Bravo Health is now the market leader, according to data provided by the company, which is part of Healthspring, a subsidiary of Cigna. Bravo said it accounted for 27,443 of the 27,886 people enrolled in dual-eligible special-needs plans last month.