HMO No-No

Your employees' health insurance allows them to choose from one of three health maintenance organizations. Once an employee has selected an HMO, he or she must get all medical care (except for out-of-state emergency care) from the HMO. Employees receive a listing of the doctors and hospitals affiliated with each HMO when they join the company and pick an HMO, and again each October when they have a one-month "open enrollment period" to change to another of the three HMOs if they choose.

As director of employee benefits, you've received an angry note from Alvin Reineke. Alvin had just received a statement from his HMO stating that it would not pay for the costs of his hernia operation performed two months ago at Swedish Hospital. Alvin is furious. One of the reasons he accepted a job with your company six months ago was its excellent healthcare coverage. He feels the company lied to him and should pay for his (rather) large hospital bill since the HMO refuses to do so.

The HMO which Alvin selected uses two hospitals, but not Swedish. When Alvin joined the company six months ago, he, like all new employees, received a thick booklet explaining the HMO options. Perhaps he did not take the time to read it carefully. But that's not your fault. Alvin can change plans during the next open enrollment, but even if he switched to an HMO that included Swedish that HMO wouldn't pay for surgery performed before he joined that HMO.

Write a memo to Alvin giving him the bad news.

Some considerations:

• What tone should you use? Should you be sympathetic? Should you remind him that this is his own fault?

• Is there any help you can give Alvin (e.g., information about credit union short-term loans or even information about negotiating payment terms with the hospital. Is it the hospital's responsibility to make sure Alvin has the right insurance to cover his medical expenses?

• What can you do to make Alvin feel that the company has not lied to him?