KOLLER

Health insurance in Rhode Island is no longer the “relative bargain” that it once was.

That’s according to a recent report from the state Department of Health and the Office of the Health Insurance Commissioner.

Compared with insurers in the rest of New England, in 2006 the dominant insurers in Rhode Island were lagging in several measures of quality, even as their premiums increased.

In previous years, the annual R.I. Health Plans Performance Report has found that Blue Cross & Blue Shield of Rhode Island and UnitedHealthcare of New England typically performed better than the rest of New England on such measures as how many children get vaccinated on time or how many subscribers get appropriate follow-up treatment for mental illness.

Not anymore, says the latest report, which is based on 2006 data.

And in the past, premiums were significantly lower in Rhode Island than in the rest of New England. But in 2006, that gap narrowed considerably, the study says.

The report, the ninth in a series of analyses required by a 1996 law, also highlights some striking differences between the two insurers. Compared with United, Blue Cross was pleasing a much higher percentage of its subscribers and taking far less out of each premium dollar for administration and profit. (United counters that its customer satisfaction has gone up since 2006 and that its higher administrative expenditures finance better services and technologies.)

To be sure, the health plans made improvements, the report says. They just didn’t keep pace with the rest of New England.

Of the 20 measures of quality, Blue Cross improved on seven, declined on one and held steady on the others. When compared with the New England average, Blue Cross performed similarly to the rest of New England on 12 measures, better on 1 and worse on 7.

United improved on 4 measures, remained the same on 14 and declined on 2. United also fell below the regional averages on 9 of the 20 quality measures, was equivalent on 9, and performed better on 2 measures.

Meanwhile, the average premiums rose so that there was little difference remaining between New England rates and Rhode Island rates.

“All told,” the report concludes, “insurance coverage through these two carriers was not the relative bargain it was in previous years.”

Christopher F. Koller, the state health insurance commissioner, said one possible reason is that many of the measures, which weigh such matters as cancer-screening rates and prenatal care, require a strong system of primary care. In Rhode Island, he said, “there is less money for the primary-care infrastructure.”

Additionally, the New England market is dominated by “the best health plans in the country,” Koller said, so it’s harder for Rhode Island insurers to measure up.

But the report will help push them to do better, he said. “This sort of public accountability continues to be important for health plans so that we understand where their strengths and weaknesses are, compared to one another and compared to the rest of New England,” Koller said. “It makes a real difference.”

Brian O’Malley, Blue Cross’s chief accounting officer and corporate controller, called the company’s premium increases “moderate.” He attributed them, in part, to higher payments to physicians as the insurer seeks to bolster the primary-care work force by bringing its rates “more in line with the rest of the region.”

With 85 cents of every premium dollar going to medical care and 69 percent of members expressing high satisfaction with the plan, “it looks that Blue Cross customers are getting the bang from the buck,” O’Malley said.

United spokeswoman Debora Spano said that premiums are going up because of increasing medical costs –– the services and technologies cost more, and people are using them more. The aging baby boom generation tends to expect top-dollar care, she said: “They utilize more than previous generations.”

As for United’s steadily declining customer-satisfaction ratings –– only half its Rhode Island customers in 2006 rated the plan as “excellent” or “very good” –– Spano said the company has been working hard to improve and expects better ratings in future reports.

On the quality measures, Spano said, United had lower-than-expected results because of problems with data-gathering. More recent information has show significantly higher scores on several measures, she said.

The full report can be found at: www.health.ri.gov/publications/HealthPlanPerformanceReport2006.pdf

ffreyer@projo.com