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February 29, 2004
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MHMR February 29,2004; Volume 12, Number 4
Health Net NE chief resigns...Premera details stock plan...Glasscock on WellPoint price tag...SPECIAL REPORT: At UBS...MCOs upbeat, investors jittery...Aetna, Amerigroup, Anthem, Centene, Coventry, Health Net, PacifiCare, Sierra, United, WellChoice...PacifiCare names Phanstiel chair...4Q03 MCO net rises 86%...Chart: 4Q03 net, 15 MCOs...NY HMO profits rise 14%...Harvard 4Q03 net margin is 1.7%...Aetna HealthFund costs up 1.6%...PacifiCare targets Latinos...HMO stocks rise 5%...Services stocks down 0.2%...Medco shares claw back...Trover to be acquired...People: Pezalla...and more...
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PEOPLE: PEZALLA
Prescription Solutions (Costa Mesa, CA), the pharmacy benefit management arm of PacifiCare Health Solutions (Cypress, CA), has name Edmund Pezalla, M.D, vice president and medical director. He was most recently with Kaiser.
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TROVER TO BE ACQUIRED FOR $60 MILLION
Trover Solutions Inc. (Louisville, KY), which provides outsourced insurance subrogation and claims recovery services, has agreed to be acquired for $60 million in cash by a private equity fund managed by Tailwind Capital Partners.
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MEDCO SHARES CLAW BACK AFTER FEHBP LOSS
Shares in Medco Health Solutions (Franklin Lakes, NJ) clawed back to $32.66 per share, up 4%, in the week ended Feb. 27, after falling 10% the previous week on word the company had lost the contract to provide pharmacy benefit management services to federal employees effective Jan. 1, 2005.
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AETNA HEALTHFUND COSTS UP JUST 1.6% FOR 14,000 LIVES
Aetna Inc. (Hartford, CT) released the results of a study showing that medical costs for nearly 14,000 HealthFund defined contribution lives among 19 employer groups rose just 1.5% in the nine months ended September 2003 compared to the same period a year earlier.
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4Q03 MCO NET INCOME RISES 86%
Fourth-quarter net income at 15 publicly traded managed care organizations rose 86% to $1.622 million on revenues of $36.338 billion, up 8%, according to a final tally by MHMR.
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PACIFICARE NAMES PHANSTIEL CHAIRMAN
Howard Phanstiel, who has led PacifiCare Health Systems (Cypress, CA) on an remarkable financial turnaround since assuming the position of chief executive more than three years ago (MHMR, Oct. 31, 2000), has been named to the additional position of chairman.
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GLASSCOCK SAYS WELLPOINT PRICE IS FAIR
Larry Glasscock, chairman of Anthem Inc. (Indianapolis), said that the price his company is paying to acquire WellPoint Health Networks represents a “fair premium,” adding that he is not at all concerned over the levels of debt and goodwill the deal brings.
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AT UBS: MCOs UPBEAT; INVESTORS JITTERY
Managed care organizations at the UBS Global Healthcare Services Conference, Feb. 2-4 in New York, expressed confidence in the industry’s prospects, proclaimed the insurance cycle a myth, and gave upbeat earnings forecasts.
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PREMERA DETAILS PROPOSED STOCK PLAN
Complying with a state regulatory order, Premera (Mountlake Terrace, WA) has released additional details on a proposed stock option compensation plan that would be available to employees assuming the company converts to for-profit status through an initial public offering.
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HEALTH NET NORTHEAST CHIEF RESIGNS
Eileen Auen, who had served as president of the northeast operation of Health Net (Woodland Hills, CA) for just a year, resigned after the company’s embarrassing announcement that it had miscalculated the impact of cost increases from New Jersey hospitals (MHMR, Feb. 15).
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