HCA St. Marks Hospital is threatening to look elsewhere for communication services because US WEST's new insurance plan allows its 3,000 Utah employees to be hospitalized at only Intermountain Health Care facilities.

"We are looking at the situation. Obviously we have to make sure from a telecommunication standpoint, we don't hinder our service. But we are looking at alternatives," Max Lauderdale, St. Mark's administrator, said Tuesday.Lauderdale is bristling over a recent decision by US WEST to allow Met Life Insurance to contract with CAPP CARE, a managed health-care organization.

CAPP CARE, based in Fountain Valley, Calif., signed an exclusive managed care agreement with Intermountain Health Care - terminating its relationship with any other facility or physician.

Until now, Lauderdale said, St. Mark's had an excellent relationship with US WEST. The University of Utah Hospital also had a "mutually beneficial relationship with both CAPP CARE and US WEST," said hospital spokesman John Dwan.

But, St. Mark's wasn't given a chance to submit a proposal to CAPP CARE - to be even considered as a provider for US WEST employees. Yet, hospital officials say they are confident their prices are competitive and that the quality of service at St. Mark's is "unsurpassed by any hospital in the area."

CAPP CARE officials say the decision to lock out St. Marks and the U. Hospital wasn't based on the quality of their health-care services. It was a business decision - precipitated by recent changes in the managed-care sector of Utah's health-care industry.

"This simply shows how extremely competitive the hospital business or industry has become. Hospitals are caught in a cost squeeze. They are expected to give care to the indigent. They are expected to provide services to Medicaid and Medicare patients without receiving full reimbursement from state and federal governments, and then they must also give discounts to the private sector," Dwan said. "This (contract) must mean IHC is willing or able to discount services more than the U. Hospital can."

Other health-care officials agree that CAPP CARE's new contract is a sign of the times.

William T. Ross, CAPP CARE vice president, said in Utah the company once had a network of hospitals centered around HCA St. Mark's Hospital, the U. and HealthTrust hospitals. HealthTrust Inc. hospitals in Utah include Brigham City Community; Lakeview Hospital, Bountiful; Pioneer Valley Hospital, West Valley City; Mountain View Hospital, Payson; Ashley Valley Medical Center, Vernal; and Castleview Hospital, Price.

But HealthTrust facilities joined the Premier Medical Network and canceled their contracts with CAPP CARE. Premier Medical Network is also owned by Holy Cross Health Services of Utah and Northern Utah Care.

Thus, according to Ross, CAPP CARE was forced to seek a relationship with one of the two major managed-care organizations in Utah - Premier Medical Network and IHC.

IHC was awarded the contract. As part of its exclusive agreement with IHC, CAPP CARE terminated its relationship with all facilities and physicians not associated with IHC.

"We had hoped to retain HCA St. Mark's Hospital in the network," Ross said in a letter to Lauderdale. "However, this was not possible."

St. Mark's executives aren't satisfied with the decision. In fact, they said it "will definitely influence future hospital decision in purchasing telecommunication services" from US WEST.

"Last year the hospital renewed its Centrex contract with US WEST, which will continue in effect for another five years. This has locked the hospital in for line charges which it will continue to honor," St. Mark's controller Larry Hancock said in a December letter to US WEST CEO Robert C. Furer. "Effective immediately, however, all other telecommunication services that are not covered under this contract will be compared with other sources to ensure the hospital is purchasing the most cost-effective services."