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September 15, 2006
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September 15, 2006; Volume 14, Number 15
WellPoint management shake-up...CA HMO profits decline in 2005...Centene appeals in Kansas...At Bear Stearns...No surprises for MCOs...Aetna, Centene, Cigna, Coventry, Health Net, Humana, Magellan, Matria, Molina, Sierra, UnitedHealth, WellPoint...Chart: CA HMO financials...2Q06 net rises at 14 MCOs...Chart: 2Q06 net, 14 MCOs...Health Net, WellCare outlook...OH HMO profits rise 8%...Chart: OH HMO financials...UAHC net, revenues fall...Aetna to renew Tenet contract...Pru downgrades 3 MCOs...People...Centene to appeal KS loss...WellPoint wins big in Kansas...Cigna debt gets “bbb-“ rating...Cigna names L.A. sales VP...Managed care stocks fall 4%...Services stocks fall 1%...BioScrip cuts costs...Healthways merger on hold...and more
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WELLPOINT SHAKE-UP; WATTS PROMOTED
As part of a plan to restructure its operations into two primary divisions, WellPoint Inc. (Indianapolis) has announced that John Watts will become chief executive of a newly created commercial and consumer business unit.
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AT BEAR STEARNS: NO SURPRISES FOR MCOs
There were no surprises among managed care companies presenting at the annual Bear Healthcare Conference, as executives look to close out a mostly solid 2006 and work toward continued gains in 2007.
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CA HMO PROFITS DECLINE 13.7% IN 2005
California HMOs reported net income of $2.637 billion in 2005, down 13.7%, on revenues of $68.859 billion, up 8.2%, according to an MHMR tally of data from the state Dept. of Managed Healthcare.
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CENTENE APPEALS KS MEDICAID LOSS
Centene Corp. (St. Louis) announced it has submitted an appeal to the Kansas Dept. of Administration over the loss of its Kansas Medicaid contract, which expires Dec. 31, 2006 (MHMR, Aug. 29).
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2Q06 MCO NET RISES 14% AT 13 MCOs
Final second-quarter 2006 financials for 13 publicly traded managed care companies show that net income rose 18% to $2.333 billion on revenues of $44.807 billion, up 25%.
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HEALTH NET, WELLCARE REAFFIRM EARNINGS OUTLOOK
Health Net (Woodland Hills, CA) has reaffirmed its previously disclosed third-quarter 2006 earnings projections of $0.68 to $0.69 per share ($80.4 million to $ 81.7 million based on 118.3 million diluted shares), including the effects of certain non-recurring items.
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OH HMO PROFITS INCREASE 8.3% IN 2005
Ohio HMOs posted net income of $305.9 million in 2005, up 8.3%, on revenues of $8.061 billion, up 1.9%, according to an MHMR tally of state insurance department data.
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UNITED AMERICAN FISCAL 4Q06 REVENUES FALL
United American Healthcare Corp. (Detroit) reported net income of $97,000 for the fiscal fourth-quarter ended June 30, 2006, down 78% from the same period a year ago.
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AETNA, COVENTRY AND HEALTH NET DOWNGRADED
Prudential Equity Group (New York) has downgraded the stocks of Aetna Inc. (Hartford, CT), Health Net Inc. (Woodland Hills, CA), and Coventry Health Care Inc. (Bethesda, MD) from “overweight” to “neutral,” citing changes in the company’s ratings system.
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BIOSCRIP CUTS SELLING, OPERATING COSTS
BioScrip Inc. (Elmsford, NY) announced that it has slashed selling and operating costs, which will result in more than $7.5 million in annualized cost savings.
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HEALTHWAYS, LIFEMASTERS MERGER ON HOLD
Disease-management companies Healthways Inc. (Nashville, TN) LifeMasters Supported SelfCare Inc. (San Francisco) have put a hold on their proposed merger, which had been scheduled to close Sept. 1.
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PEOPLE: SCHORNICK; BROWN; SMITH
Cigna Corp. (Philadelphia) has named Amy Schornick vice president of network operations for Cigna Healthcare of Texas, responsible for the north Texas and Oklahoma markets.
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