Medical Mutual eyes Indiana for growth

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Even though some health insurers recently have withdrawn from parts of the Indiana market, Medical Mutual of Ohio is eyeing Hoosiers as its next growth engine.

The Cleveland-based company covers more than 1.6 million health care customers in Ohio, Georgia, South Carolina, Michigan and Indiana. The company has been selling policies in Indiana for the past decade, and in 2010 had 16,000 members here.

That’s a pittance compared to Indianapolis-based WellPoint Inc., which covers roughly 3 million Hoosiers, including nearly two-thirds of the 3.6 million covered by employer-sponsored plans. But Medical Mutual is undeterred by WellPoint’s dominance.

Medical Mutual has built out a network of providers across the state, including the addition of Indianapolis, Lafayette and northwestern Indiana on July 1. The company used that network to help win new accounts this year, including the roughly 200 employees of WTHR-TV Channel 13 in Indianapolis, part of Columbus, Ohio-based The Dispatch Printing Co.

“Having our own network allows us to have large accounts,” said Andrew Niederst, Medical Mutual’s director of provider contracting. He noted the company previously had focused on individual and small-employer customers. The company also used to sell policies under the name Consumers Life, but this year converted all its Indiana business to the Medical Mutual brand.

Medical Mutual expects enrollment in its health plan to grow 30 percent next year, to nearly 21,000. And then it expects growth of another 40 percent.

Niederst added that Medical Mutual’s financial structure—it is owned by its members, not by stockholders—can help it win business by pricing more attractively for employers.

“Being a mutual company does allow us more flexibility and just the opportunity to compete with those large organizations,” he said. “We don’t have to maximize our financial returns to meet the demands of stockholders.”

Medical Mutual also touts its customer service as a point of differentiation from larger insurers.

Niederst said Medical Mutual is still trying to add physicians, hospitals and other health care providers to its network. Until this year, the company rented access to provider networks. Providers, he said, typically are happy to have another health insurance option.

“We feel competition’s a good thing, and that’s been our story to providers: Allow another payer to grow into the market,” Niederst said. “It obviously gives people more choice.”


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  1. Apologies for the wall of text. I promise I had this nicely formatted in paragraphs in Notepad before pasting here.

  2. I believe that is incorrect Sir, the people's tax-dollars are NOT paying for the companies investment. Without the tax-break the company would be paying an ADDITIONAL $11.1 million in taxes ON TOP of their $22.5 Million investment (Building + IT), for a total of $33.6M or a 50% tax rate. Also, the article does not specify what the total taxes were BEFORE the break. Usually such a corporate tax-break is a 'discount' not a 100% wavier of tax obligations. For sake of example lets say the original taxes added up to $30M over 10 years. $12.5M, New Building $10.0M, IT infrastructure $30.0M, Total Taxes (Example Number) == $52.5M ININ's Cost - $1.8M /10 years, Tax Break (Building) - $0.75M /10 years, Tax Break (IT Infrastructure) - $8.6M /2 years, Tax Breaks (against Hiring Commitment: 430 new jobs /2 years) == 11.5M Possible tax breaks. ININ TOTAL COST: $41M Even if you assume a 100% break, change the '30.0M' to '11.5M' and you can see the Company will be paying a minimum of $22.5, out-of-pocket for their capital-investment - NOT the tax-payers. Also note, much of this money is being spent locally in Indiana and it is creating 430 jobs in your city. I admit I'm a little unclear which tax-breaks are allocated to exactly which expenses. Clearly this is all oversimplified but I think we have both made our points! :) Sorry for the long post.

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