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Insurer Drops Medicaid in 6 Western New York Counties

A major Western New York insurer has informed the Department of Health of its intention to stop offering three low-income health coverage programs to 53,000 members.

BlueCross BlueShield of Western New York recently announced plans to discontinue administration of Medicaid Managed Care, Child Health Plus, and Family Health Plus in Allegany, Orleans, Wyoming, and three other counties.

The health insurer says a gap in the state’s Medicaid repayment structure led to $40 million in losses over the last 3 years.

Julie Snyder, director of Corporate Relations, says the company was comfortable breaking even or taking some loss on the Medicaid program, but the shortage became untenable.

“We were really starting to see those losses cross-walked into our commercial lines of business. And you just cannot expect employers and families and individuals to start to subsidize one block of your healthcare business with another block,” said Snyder.

According to Snyder, the move will not leave people without health care, because they will be transferred to other providers in the area. Although rural Medicaid recipients will need to check that their physician is within the new network.

“When you get to the more rural counties there may be an impact in terms of a specific doctor. In those instances, they'll need to work with their new health plan to make sure that they identify and select a primary care physician, probably more so than a specialist or a hospital,” said Snyder.

By October, members who do not switch to a new provider will be automatically transferred.

Excellus BlueCross BlueShield made a similar decision in 2013 that affected 14 counties, primarily in Central New York.