Many Los Angeles employers are likely to face double-digit increases from their health plans in 1999. Health care benefits consultants predict that many health maintenance organizations will follow the lead of Kaiser Permanente, which asked the California Public Employees Retirement System for a 12 percent increase in premium costs for next year. The Business Journal asks:

As HMOs prepare to raise premiums next year, is your company likely to feel the pinch?

Julia Gouw

Executive Vice President

East West Bank

Actually, even this year we have already seen the premium increase a little. But on an overall basis, if they provide good service to the members, to the employees, then it doesn’t affect us negatively. The key is that they continue to provide good service. The cost is important but, for example, this time we are projecting a 3 to 4 percent increase and as long as our employees feel that they get better service, we are satisfied.

Elaine Locksley

President

Locksley Group Ltd.

We don’t have an HMO and I wouldn’t have an HMO. They don’t provide good things for their patients. They care more about money than patient care. We have a PPO (preferred provider organization). Health care is very important and we wouldn’t risk it by going with an HMO. I think that it is ludicrous that they are raising their rates. They don’t let you get what you need and now they are raising their rates. Outrageous.

Dustan Hoffman

Vice President

Crown Prince Inc.

I have no idea what will happen, but in the past it has not affected us. With Care America it has not gone up, but when we were with FHP it went up, so we switched. Costs are a factor. Double-digit increases would be a problem, but we would not get off the plan. We will have a plan no matter what the cost.

Anna Wong

Controller

A Band Apart Commercials

Our company is a mid-sized company, and this forces the mid-sized and smaller companies to rethink their strategies about providing health care benefits. I think it’s counterproductive, because the current administration is emphasizing better health care, but for smaller companies it will be a burden. Who is this going to be hurting? The individuals, the employees, as well as the companies. Employees are going to rethink whether to go to a company. Providing the HMO option is cheaper for the individual as well as for the company, but if the rates go up, we’re going to have to rethink our strategy.

Ross A. Crowe

Vice President and Director of Operations

Grubb & Ellis Management Services Inc.

I think most companies will feel the pinch. A lot of the pinch has more to do with how individuals and employees feel about HMOs. I think there’s still a lot of mistrust. Quality of service and care is important, but as an industry, the HMOs need to improve their image. I don’t think they’ve said enough for what they’re going to do for the masses in terms of service and care. It’s part of the American way now. They haven’t done a very good job of making people feel good. (As far as raising the rates), I don’t think it’s right.

Tom Kelley

First American Title Co. of Los Angeles

Since the employers subsidize the employees, it’s certainly a large item the employer pays. I don’t know if they’re raising the rates, but certainly if they do, it’s going to affect how much we pay. And I can’t help but think that it will probably cost the employees more money too, since we share the cost.