Managed Care Report
Managed Care Report
• AHT Corp. (Tarrytown, NY) said last week it will launch a comprehensive pilot program with Merck-Medco Managed Care to provide Internet-based prescription management services to physicians located in up to four major metropolitan areas. Based on the success of a recently completed, initial six-month pilot in New Jersey, AHT and Merck-Medco now plan to provide online prescription management services to as many as 200 additional physicians.
• Coventry Health Care (Bethesda, MD) reported results for FY98 and 4Q98 ended Dec. 31. For the year, the company recorded total operating revenues of $2.1 billion, up from FY97 revenues of $1.2 billion. The company reported a net loss in FY98 of $11.7 million, 22 cents per share, compared to a FY97 net income of $11.9 million, 35 cents per share. The company recorded 4Q98 revenues of $603.1 million, up from 4Q97 revenues of $321.2 million. In 4Q98, the company recorded a net income of $6.2 million, 11 cents per share, compared to a 4Q97 net income of $3.5 million, 10 cents per share. Lower-than-expected Principal Health Care merger expenses resulted in a gain to 4Q98 earnings of $1.3 million, a reduction of the charge taken in 2Q98, Coventry said.
• Continucare Corp. (Miami) reported its results for 2Q99 ended Dec. 31. The company recorded a net loss for 2Q99 of $10.3 million, 71 cents per share, compared to a 2Q98 net loss of $3 million, 25 cents per share. The net loss for 2Q98, the company said, included a loss of $4.2 million from the sale of the company’s diagnostic imaging services business in December 1998. Continucare’s 2Q99 revenues totaled $52 million, up from 2Q98 revenues of $7.1 million. In other news, Continucare believes that, based on its own internal analysis, information provided by one of the HMOs with which it contracts may include claims improperly charged to the company. Continucare received information indicating a liability to the HMO of $700,000 at June 30, 1998, and about $3.7 million at Dec. 31, 1998. Continucare said its own consolidated statements of operations include a loss of about $1.4 million for 2Q99 ended Dec. 31, 1998, relating to its relationship with the HMO. The HMO is reviewing the information it previously provided, according to a filing with the Securities and Exchange Commission (Washington). Because the HMO did not timely provide the information as required by the contractual relationship, this issue could not be resolved prior to the filing of Continucare’s latest quarterly report. Accordingly, Continucare’s consolidated statements of operations and balance sheets do not include an estimate of any amount that may be recoverable. Continucare recently announced that it is facing a challenging time. It is shedding unprofitable units, starting with the sale of its diagnostics imaging business. And it has signed long-term agreements with managed care payers that include rate increases.
• Maxicare Health Plans (Los Angeles) reported a net loss of $5.7 million, 32 cents per share, for 4Q98 ended Dec. 31. In 4Q97, the company recorded a net loss of $11.4 million, 64 cents per share, which included a $3 million charge for management restructuring costs and a $7.5 million charge to increase healthcare claims reserves. 4Q98 revenues totaled $177.4 million, compared to 4Q97 revenues of $176.3 million. For the year, Maxicare reported revenues of $735.2 million, up from FY97 revenues of $671.3 million. The company recorded a FY98 net loss of $27.5 million, $1.54 per share, compared to a FY97 net loss of $25.1 million, $1.40 per share.
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