If you have looked at your Open Renewal packets for this month, you will see that one of the HMOs available to UCD employees is WHA, Western Health Advantage, a consortium composed of Woodland Clinic and Hospital, Mercy Healthcare, NorthBay Health System, and UCD Medical Center. Formed in 1995, WHA was supported by the Regents because it was felt that the HMOs involved would direct referrals for serious treatment to UCDMC. The Regents support was strong enough that they contributed $1.5 to WHA’s formation. At the Sept. 19, 1998 meeting of the Regents, it was reported that WHA’s enrollments had fallen below estimation (26,300 as opposed to an expected 38,600), and costs had exceeded estimation. Since the Regents had agreed to share operating expenses, the bill to them was $4,183,006, $2,683,006 beyond the original contribution, and $721,000 more than anticipated. WHA’s losses this current year are expected to be $3.4 million, and the Regents are responsible for one-third of that amount, plus ongoing operating expenses. It is claimed that most of the unanticipated expenses came from pharmacy and out-of-area claims.
From 1996-1998, inpatient referrals to UCDMC increased 25%, for a $12 million increase of net income, at least in part through affiliation with WHA. Through this larger umbrella organization, there are economies of scale, including licensing fees. There are also increased, and geographically expanded, opportunities for residency training
In the next two years, WHA plans to expand to four more counties (El Dorado, Calaveras, Placer, and San Joaquin). WHA will also develop a Medicare Risk product that will increase it’s marketability to UCD retirees, and to seek contracts with other large public and private sector employers. WHA’s UC affiliation is a distinguishing feature that is expected to be significant in UC employee enrollment decisions.