- Oxford Sees First Quarter Commercial Member Growth Above Projections -
TRUMBULL, Conn., March 13 /PRNewswire-FirstCall/ -- Oxford Health Plans,
Inc. (NYSE: OHP) today announced the completion of its acquisition of MedSpan,
Inc., for approximately $18 million. Oxford announced the proposed
acquisition of MedSpan in December of last year, pending the approval by the
Connecticut Department of Insurance.
(Logo: http://www.newscom.com/cgi-bin/prnh/20001212/OXHPLOGO )
With the completion of this acquisition, Oxford has expanded its
Connecticut network to include more than 7,400 providers affiliated with 32
Connecticut hospitals that service MedSpan's approximately 51,000 fully
insured commercial members and 22,000 ASO, or self-funded, members. MedSpan
had full-year commercial revenues of $128.1 million in 2001 and $106.8 million
in 2000.
"Combining Oxford's and MedSpan's strengths, including strong physician
networks and innovative health plan designs, will provide new choices for
Connecticut employers and consumers," said Norman C. Payson, M.D., chairman
and chief executive officer of Oxford. "We believe this acquisition will
transform us from a niche player predominantly in Fairfield County to a
company with the kind of statewide presence that we have recently found many
corporate purchasers are seeking."
This transaction is not expected to have a material effect on Oxford's
results of operations in 2002.
Commenting on recent commercial membership trends, Dr. Payson stated, "We
believe, based on our most recent analysis of sales data, that fully insured
net commercial enrollment for the first quarter of 2002, exclusive of MedSpan
membership, appears to be running 8,000 to 10,000 members above our most
recent projections of net growth of 8,000 members for the period."
"Oxford's regional focus and medical management discipline are distinct
competitive advantages, enabling us to offer diverse and affordable health
plan products to meet the ever-changing needs of employers and consumers in
this marketplace," Payson added. "Recognition of this value proposition is
reflected in our continued commercial membership growth."
Founded in 1984, Oxford Health Plans, Inc. (http://www.oxfordhealth.com)
provides health plans to employers and individuals in New York, New Jersey and
Connecticut, through its direct sales force, independent insurance agents and
brokers. Oxford's services include traditional health maintenance
organizations (HMOs), point-of-service (POS) plans, preferred provider
organization (PPO) plans, third-party administration of employer-funded
benefits and Medicare plans.
Cautionary Statement Regarding Forward-Looking Statements
Certain statements in this press release, including statements concerning
the effect of the Company's acquisition of MedSpan and the Company's
commercial membership growth, and other statements contained herein regarding
matters that are not historical facts, are forward-looking statements as
defined in the Securities Exchange Act of 1934; and because such statements
involve risks and uncertainties, actual results may differ materially from
those expressed or implied by such forward-looking statements. Factors that
could cause actual results to differ materially include, but are not limited
to:
* Changes in Federal or State regulation relating to health care and
health benefit plans, including proposed patient protection
legislation and mandated benefits.
* The state of the economy.
* The impact of the September 11, 2001 terrorist attacks, subsequent
cases of anthrax infection or exposure, and any future acts of
terrorism or war.
* Rising medical costs or higher utilization of medical services,
including higher out-of-network utilization under point-of-service
plans and new drugs and technologies.
* Competitive pressure on the pricing of the Company's products,
including acceptance of premium rate increases by the Company's
commercial groups.
* Higher than expected administrative costs in operating the Company's
business and the cost and impact on service of changing technologies.
* The ability of the Company to maintain risk transfer and other
provider arrangements and the resolution of existing and future
disputes over the reconciliations and performance under such
arrangements.
* Any changes in the Company's estimates of its medical costs and
expected cost trends.
* The impact of future developments in various litigation (including
pending class and derivative actions filed against the Company and
certain of its officers and directors, and other proceedings commenced
against the Company and several employees by certain healthcare
providers), class actions in Connecticut and New York and related
litigation by the Connecticut Attorney General, regulatory proceedings
and other governmental action (including the ongoing examination,
investigation and review of the Company by various Federal and State
authorities).
* The Company's ability to renew existing members and attract new
members.
* The Company's ability to develop processes and systems to support its
operations and any future growth and administer new health care
benefit designs.
* Those factors included in the discussion under the caption
"Business -- Cautionary Statement Regarding Forward-Looking
Statements" in the Company's Annual Report on Form 10-K for the fiscal
year ended December 31, 2001.
SOURCE Oxford Health Plans, Inc.
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Related links:
http://www.oxfordhealth.com
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Company News On-Call:
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CONTACT:
Media - Maria Gordon Shydlo, +1-203-459-7674,
mshydlo@oxfordhealth.com, or Investor - Deborah Abraham,
+1-203-459-6674, dabraham@oxfordhealth.com or Gary Frazier,
+1-203-459-7331, gfrazier@oxfordhealth.com, all of Oxford Health
Plan
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