PacifiCare Posts ‘Unexpectedly Strong’ Third-Quarter Results
PacifiCare Health Systems, the nation's largest operator of Medicare HMOs, announced yesterday that its third-quarter earnings were "unexpectedly strong," the Los Angeles Times reports (Lee, Los Angeles Times, 10/31). The company reported a third-quarter profit of $43.8 million, up from $17 million a year earlier (Wolfson, Orange County Register, 10/31). PacifiCare's earnings were bolstered by premium increases that outpaced the cost of medical care, the Times reports (Los Angeles Times, 10/31). Officials also attributed the financial results to the elimination of unprofitable operations in the company's Medicare and commercial businesses. PacifiCare's membership dropped by 423,000 to just under 3.2 million (Orange County Register, 10/31). At the end of the third quarter, PacifiCare's senior membership decreased 21% to 795,000. Company officials increased PacifiCare's full-year earnings estimate to $3.90 a share, up from a previous estimate of $3.40 (Los Angeles Times, 10/31). PacifiCare CEO Howard Phanstiel said, "This time we clearly surpassed even our own expectations -- as well as those of Wall Street" (Orange County Register, 10/31).This is part of the California Healthline Daily Edition, a summary of health policy coverage from major news organizations. Sign up for an email subscription.