Anthem to Cut 500 Jobs in Three States

Anthem Inc., attempting to reduce its administrative costs because of continuing financial losses, will eliminate approximately 500 jobs in the coming months, including some in Lexington and Louisville. Most of the positions being eliminated are in claims processing, customer service and enrollment services.

In Lexington, it will eliminate its operations positions, a loss of 90 to 100 jobs, leaving about 120 other employees there.

Anthem officials expect most of the job reductions to be completed by April.

Anthem has suffered sharp underwriting losses in Kentucky, which it blames on recent healthcare reform laws that forced dozens of health insurers out of the state. Anthem is currently the only private insurer to offer individual health policies in Kentucky.

Last month the company announced plans to increase rates by 44.5 percent on small-group health insurance policies, which provide coverage for about 50,000 people.

Humana Creates HMO Consulting Co.

Louisville-based Humana, Inc. is launching a subsidiary to provide consulting services to healthcare providers interested in sponsoring their own Medicare health maintenance organizations.

The company, called MedStep, will advise hospitals and physicians' organizations on the feasibility of creating an HMO and then assist such organizations in everything from obtaining federal approval to operating the HMO.

The company's revenue will be closely tied to the membership of any HMOs it helps form.

The Federal Health Care Financing Administration expects as many as 400-800 new HMOs will be formed in the next two to four years.

MedStep's headquarters and its size have yet to be determined.

New Medical Uses for Tobacco

Biosource Technologies, a firm using Kentucky-grown tobacco to develop a method of altering the proteins produced by the plant, hopes that the new technology will result in the commercial production of pharmaceuticals by next year.

Vice President Barry Holtz, one of three biotechnology executives who spoke January 14 at the Tobacco Workers' Conference, told tobacco farmers and grower organizations that he believes the new process will be possible with the January 13 opening of a new facility in Owensboro. Holtz and other executives were part of a symposium sponsored by the University of Kentucky Tobacco and Health Research Institute. Tobacco has the potential to produce medicinal products, food ingredients, enzymes and polymers, Holtz said. Biosource Technologies alters the proteins produced by tobacco by introducing a genetically-engineered virus.

A more common method is to genetically alter the plant itself. CropTech Development uses such transgenic plants to produce pharmaceutical proteins. CropTech President David Radin said tobacco works well because the plant is:

• The easiest plant to genetically engineer
• An excellent biomass producer
• A prolific seed producer – up to a million seeds from one plant
• The recipient of growing public support for alternative uses

Food and biological materials made in tobacco have huge potential markets, which translate into huge potential acreage for Kentucky farmers, said Richard Basel, Agricola Technologies, Inc. vice president of research and development.

Maelor Davis, director of the UK Tobacco and Health Research Institute, said that the institute has worked in collaboration with Biosource and is discussing the possibility of collaboration with the other companies represented at the symposium.

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