To protect the "competitive and robust" Medicare turf in Denver, PacifiCare of Colorado (PC) mounted a public affairs showdown that sent the Health Care Financing Administration (HCFA) packing.
Racing against the clock, the gutsy crisis communications campaign (launched last January) headed off HCFA plans for a three-year Medicare competitive pricing project that would have stripped funding from the metro area's health plans.
In drawing the battle lines, the campaign strategy focused on seniors being potentially robbed of high-quality Medicare benefits as a result of the demonstration, as opposed to health plans being burned by the measure.
"We didn't want to make this just an HMO fight," said Bob Threlkeld, a principal with Johnston Wells, PC's PR agency. Sounding this politically charged alarm allowed the Denver-based agency to get the ear of HMO executives, trade associations, state and federal legislators as well as physician groups.
Ultimately, the opposition effort led to an amendment to the 1997 Supplemental Appropriations legislation to freeze funding for the demonstration project. Since the campaign, the amendment has been signed into law and funding for the project has been repealed altogether.
The campaign, headed up by Threlkeld and Edie Dulacki, a JW counselor, was awarded a Colorado Healthcare Communicators' Gold Leaf award in the crisis communications category last month.
Tough Calls
When HCFA made the demonstration announcement on Jan. 30, PC's initial response was to work with the federal agency on studying the implications of competitive pricing for the seven Medicare HMOs in the Denver area, according to Laura Wegscheid, PC's director of communications. After all, HCFA is not only a major source of funding for PC but the federal government is a major client (50,000 federal employees are covered by the PC health plan).
But shortly after the announcement, it quickly became apparent that PC would have to take a defensive stance against the far-reaching implications of the demonstration that would have each Medicare plan bidding on a standardized benefits package.
The potential fallout of this measure would have:
- altered senior health plan benefits and increased costs for members;
- caused a cost-induced migration of members from one plan to another (causing physicians, hospitals and other providers to rework their health plan affiliations); and
- added a third-party enrollment broker (further complicating the enrollment process).
By March 1997 the campaign went into crisis mode and the focus became killing the demonstration by recruiting key influencers who had a vested interest in exposing the negative impact of the demonstration.
Campaign Arsenal
To mobilize opposition to the demonstration, the Johnston Wells team, with a budget of $76,890, drafted opposition statements to the campaign's core audience of health plan executives, trade associations, legislators and physician groups.
The messages consistently concentrated on 10 adverse effects of the demonstration to the Medicare marketplace but did not "demonize HCFA," said Threlkeld.
The messages included a white paper outlining the nuts and bolts of the opposition, template letters to the target audience for a letter-writing campaign to legislators and a question-and- answer fact sheet about the project for PC corporate representatives.
Several trips to Washington by PC top-level executives were also coordinated to lobby Colorado's congressional delegation.
Initially, the media took a back seat to the campaign's focus on forging relationships with special interest groups. This strategy evenutally backfired because early coverage of the demonstration had a HCFA slant. HCFA went straight to the local print media, blasting the area's health plans for resisting competition, according to Wegscheid.
Eventually these claims were countered through more balanced editorial stories and Op-Ed pieces written by legislators and health plan executives.
Although the campaign was successful at halting the demonstration, Wegscheid concedes that more consumer outreach would have cemented PC's position on the volatile issue of Medicare competition.
"We wanted to keep consumers out of the fray, we didn't want to worry them...But HCFA was getting to them and some had formed negative preconceived notions about health plans." (JW, Bob Threlkeld, Edie Dulacki, 303/623-3366; PC, Laura Wegscheid, 330/220-5800)