Insurers Hire Firm To Keep Track of Surgical Problems

Health Care

by Laurence Darmiento

Blue Cross of California and PacifiCare Health Systems Inc. have become the first mainstream health insurers to sign with a company that tracks surgery complication rates at California hospitals.

It’s part of an industry move toward “consumerism,” the notion of empowering consumers, often with simply more information.

Subimo LLC, a Chicago-based medical data firm, provides data that allows insurance plan members to check, for example, the complication or mortality rate of a particular surgery, and then make a determination at which hospital to have it performed.

Blue Cross, a subsidiary of WellPoint Health Networks Inc., last month began offering the data through its Web site to its PPO and self-insured health plan members.

“There is a great deal of consumer demand for this information and this is an attempt to meet that demand,” said Dr. Michael Belman, staff vice president for quality management at Blue Cross.

Jim Barber, president of the Healthcare Association of Southern California, the regional hospital industry trade group, said hospitals have nothing against the idea in principle but are concerned about the quality of information. He noted that some of the state data Subimo draws from is three years old.

SCPIE Retreat

SCPIE Holdings Inc. is getting back to basics.

After suffering a $60 million loss last year, the Los Angeles-based medical malpractice insurer has decided to refocus on its core Southern and Northern California markets.

During the late 1990s the company expanded from its California base, where it has underwritten malpractice insurance since 1975 in a quest for larger profits. Instead, it ended up getting pummeled last year with nearly $135 million in underwriting losses (offset by income tax benefits and investment gains).

The company has decided to pull out of Texas, Florida and other states, leaving it with out-of-state business only in Delaware. It is also has pledged to follow stricter underwriting standards. But chief executive Donald J. Zuk said the company would not rule out other out-of-state business.

“If my underwriter thinks it’s a good piece of business I would be interested, but I am not going to beat the bushes for it,” Zuk said.

Hope Trial Redux

The City of Hope National Medical Center took a second try last week in its breach of contract case against Genentech Inc.

The Duarte cancer center is seeking $457 million in royalties and interest payments stemming from research done by two City of Hope scientists that led to the creation of synthetic insulin, among other products.

The pioneering South San Francisco biotechnology firm claims it has already paid the hospital $293 million under the 1976 agreement and owes it nothing else. But the hospital contends it is owed money from license agreements Genentech reached with third parties using the research.

Staff reporter Laurence Darmiento can be reached at (323) 549-5225 ext. 237 or at

[email protected].