Business
HMO profits rise
NEWS IN BRIEF — Posted March 22, 2004
A study of 463 HMOs' financial performance during the second quarter of 2003 found that profits at the health plans rose 73.3% over the same period in 2002.
Jupiter, Fla.-based Weiss Ratings Inc. found that the collective profits of the health plans was $4.3 billion compared with $2.5 billion a year earlier. Weiss is an independent provider of ratings and analysis of financial services companies, mutual funds and stocks.
The hefty increase in net income is attributable to increased premiums, streamlined operations and the elimination of unprofitable business lines, said Melissa Gannon, vice president of the ratings company.
The capital reserves of the HMOs also have risen, indicating the companies are financially stronger. Aggregate net worth of the HMO industry rose 70%, from about $23 billion at year-end 1998 to $39 billion in June 2003.
Note: This item originally appeared at http://www.ama-assn.org/amednews/2004/03/22/bibf0322.htm.
