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QualChoice Will Discontinue Medicare+Choice Product

WINSTON-SALEM, N.C. – QualChoice of North Carolina Inc. is now notifying its MedicareGold plan enrollees that it will discontinue the plan at the end of calendar year 2002. Notices have been mailed to enrollees, and meetings will be held soon to discuss options for future health care coverage.

QualChoice officials cited claim expenses that are increasing at a much higher rate than the federal reimbursement as the principal reason for the decision to end the plan, known generically as a "Medicare+Choice" product. MedicareGold now has about 12,800 enrollees in 13 northwestern North Carolina counties.

David Patterson, QualChoice''s president and CEO, said that QualChoice will provide the MedicareGold members the same benefits and level of service they have come to expect through the end of this year. But increasing financial pressures have forced the discontinuation after 2002.

“We have tried very hard to reign in the costs of health care, to allow our members to access the high quality services of Wake Forest University Baptist Medical Center,” Patterson said. “But Medicare reimbursements will increase only two percent in 2003, and claims expenses are expected to be in the 12 to 14 percent range. We expect that trend to continue in the future.

“QualChoice generated a modest profit for 2001, but the current trends indicate that Medicare+Choice is not a viable long-term product,” Patterson said.

Health care options and member Medicare rights will be discussed in meetings to be held this summer and again in the fall throughout the QualChoice service area.

The elimination of the MedicareGold product will result in further downsizing of the QualChoice workforce. In November the health maintenance organization announced that it would discontinue its employer-group coverage. The six-month phase-out of that plan was completed May 8, eliminating about half of the HMO’s 235 jobs. The elimination of MedicareGold, which ends coverage for its members on December 31, 2002, will result in operations all closing by June 2003.

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Contact: David Patterson, (336) 716-0907, or Mark Wright, (336) 716-3382

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