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January 15, 2006
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MHMR Jan. 15, 2006; Volume 14, Number 1
SPECIAL REPORT: Outlook for 2006...15 top execs on 2006 outlook...Aetna, BCBS-MA, BCBS-MI, BCBS-NC, Blue Shield-CA, Cigna, Group Health, Harvard Pilgrim, Health Net, Humana, HealthPartners, Horizon BCBS, Sierra, Tufts, WellPoint...’06 profits to grow 15%...’05 MCO margins top 5%...MCO stocks beat Street in ‘05...Wall Street mixed on 2006...McKeever tops in ’05 picks...Borsch downgrades sector...Part D bumps in the road...Health Net buys Universal assets...Aetna names Williams CEO...WellPoint taps Stocker...HMO stocks rise 1%...Services stocks rise 3%...Matria stresses DM...and more...
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HEALTH NET BUYS UNIVERSAL CARE ASSETS
Health Net (Woodland Hills, CA) announced a definitive agreement to acquire the health plan assets of Universal Care Inc. (Long Beach, CA), which serves 75,000 commercial, 5000 Medicare and 20,000 Medicaid lives in California.
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AETNA NAMES WILLIAMS CEO
John Rowe, M.D., 61, the unlikely savior of Aetna Inc. (Hartford, CT), announced that he would step down as chief executive effective Feb. 14, with company president Ronald Williams, 56, taking over the reins.
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CAN THE GOOD TIMES LAST FOR MANAGED CARE?
Coming off yet another year of strong financial performance, the managed care industry is looking toward 2006 with visions of continued solid profits, new opportunities in Medicare and consumer-directed healthcare, and premium increases in line with medical cost trends.
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’06 MANAGED CARE PROFITS TO GROW 15%, CRG SAYS
Managed care industry profits are projected to grow another 15% in 2006, according to The Outlook for Managed Care, 2006, a 100-page annual report prepared by the editors of MHMR. Profits rose 21% in 2005.
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MCO PROFIT MARGINS TOP 5% IN 2005
Managed care industry profit margins rose to 5.5% among 14 publicly traded managed care organizations through the first nine months of the year, compared to the same period a year earlier.
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BORSCH DOWNGRADES UNITEDHEALTH, SECTOR
Matthew Borsch of Goldman Sachs, who expects a tough road ahead for managed care stocks in 2006 and 2007, announced that he had downgraded the sector to “cautious” from “neutral” and also downgraded industry leader UnitedHealth Group to “underperform” from “not rated.”
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BORSCH DOWNGRADES UNITEDHEALTH, SECTOR
Matthew Borsch of Goldman Sachs, who expects a tough road ahead for managed care stocks in 2006 and 2007, announced that he had downgraded the sector to “cautious” from “neutral” and also downgraded industry leader UnitedHealth Group to “underperform” from “not rated.”
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MCOs KEEP SIGNING UP PART D LIVES DESPITE BUMPS
The newly minted Medicare Part D drug program took effect Jan. 1, 2006 and immediately felt the pains of a new multi-billion dollar program attempting to serve millions of members overnight.
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WELLPOINT NAMES STOCKER EAST REGION CEO
As expected, Michael Stocker, M.D., formerly chief executive of WellChoice, has been named president and CEO of WellPoint’s east region, including Blue Cross Blue Shield plans in Connecticut, Georgia, New Hampshire, New Jersey, New York and Maine.
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MATRIA TO FOCUS ON DISEASE MANAGEMENT, WELLNESS
With its decision to sell its diabetes development and services operations, Matria Healthcare (Marietta, GA) has made the strategic decision to focus entirely on disease management and wellness.
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