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Harvard Pilgrim
acquires Health Plans
(June
2005 Issue)
By Elinor Nelson
Harvard Pilgrim Health Care has acquired Health Plans, Inc., a
third party administrator based in Westborough, Mass. Harvard Pilgrim
is the second largest health insurer in Massachusetts and Health
Plans, Inc. has more than 20 years of experience offering administrative
and consulting services to health and benefit plan sponsors, including
self-funded employers and union-negotiated programs. Harvard Pilgrim
will be gaining Health Plan, Inc.'s expertise in offering programs
to self-insuring employers, while Health Plan, Inc. will be gaining
access to Harvard Pilgrim's network of doctors and hospitals.
Sharon Torgerson, spokesperson for Harvard Pilgrim, says that
the purchase is not expected to affect the psychologists in either
Harvard Pilgrim's or Health Plan, Inc.'s networks. Since Jan, 1,
2005, PacifiCare Behavioral Health, Inc. has administered Harvard
Pilgrim's mental health benefits and that situation will not change.
With the addition of Health Plans, Inc., which brings about 81,000
members, Harvard Pilgrim and its affiliates will be serving more
than 900,000 members. Health Plans, Inc. has been operating primarily
in Massachusetts, Maine and New Hampshire, administering health,
dental and short-term disability benefits through self-insured plans.
Health Plans, Inc. has carved out a niche developing products and
services for businesses with 70 to over 1,000 employees. It will
be a wholly owned subsidiary and will continue to operate as a separate
entity.
As a third party administrator, Health Plans, Inc. helps companies
self-fund their employee benefits. It is designed to help them realize
substantial savings compared to using a health insurance company.
Self-funded benefit plans can reduce costs by eliminating state-mandated
benefits (such as those for infertility), insurance company profits
and premium taxes.
Health Plans, Inc.'s services include claims processing, fund or
premium accounting, provider utilization management and risk related
services such as excess-loss and reinsurance services. "Having Health
Plans, Inc. as a subsidiary will enhance our capacity to offer a
full range of health benefit options and solutions to employers
in Massachusetts, Maine and New Hampshire," says Charles D. Baker,
president and CEO of Harvard Pilgrim. "We believe that adding their
expertise in developing products and services for the self-insured
market to Harvard Pilgrim's top-rated performance in clinical quality
and service will be a winning combination."
Harvard Pilgrim's Senior Vice President of Sales and Marketing
Vin Capozzi, adds, "This is a great fit that will strengthen our
ability to serve those businesses that have chosen to self-insure
and that want custom-designed plans or separately priced services."
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