UnitedHealth Group Inc., the parent of Cypress-based PacifiCare Health Systems, is expecting a drop in its 2009 commercial health plan enrollment.
UnitedHealth said earlier this month that its commercial health insurance enrollment could drop up to 5.7% in 2009, a shift from the 3% growth it expects for 2008.
The Minneapolis-based health insurer said it could lose up to 1.5 million members from its estimated 2008 enrollment of 26.8 million members, according to a slideshow presentation posted before the company’s recent investor day in New York.
A mix of attrition and pricing discipline led to the enrollment shift, UnitedHealth said in the presentation.
But the company isn’t lowering its prices as a reaction. It is basing its health insurance prices on insurance risk, rather than the market, it said.
UnitedHealth also expects some customers to come back.
“There may be more pricing discipline coming into the market as a whole, and as that happens, we’ll start getting some of this business back,” Don Nathan, a UnitedHealth spokesman, told the Associated Press.
UnitedHealth is the country’s second-largest health insurer, trailing only Indianapolis-based WellPoint Inc., which is the parent company of Anthem Blue Cross.
On the other hand, UnitedHealth said it did expect growth in its Medicare Advantage HMO plan, growing enrollment by 100,000 to 135,000 members in 2009.
That may not necessarily be a boon. Political observers have said that Medicare Advantage funding could be on the chopping block with the change of control in Washington.
Overall, UnitedHealth and its peers haven’t had the easiest of years. The company twice reduced its 2008 earnings expectations in the wake of business line challenges, and insurers have been pressured because of investment portfolio concerns growing out of the global credit crisis.
ICU’s Growth Strategy
ICU Medical Inc., a San Clemente-based device maker, is set to gain access to 2,000 hospitals and 50,000 other sites through a five-year deal it signed with Premier Inc., one of the country’s largest bulk hospital purchasing groups, this summer.
ICU makes single-use medical and surgical devices, including needleless connectors used in the delivery of intravenous drugs.
Premier, which is based in San Diego, will market and distribute ICU’s products starting in January. ICU will gain access to customers through the contract it couldn’t previously reach.
“That means we can go into the 40% of U.S. hospitals that were not available to us,” Chief Executive George Lopez told Investor’s Business Daily, which ran a recent article about ICU’s growth strategy.
Quality Systems: No. 4 in Forbes
Quality Systems Inc., an Irvine maker of medical software, came in at No. 4 on Forbes’ recent listing of America’s 200 best small companies. Last year, Quality ranked No. 5 on the list.
Forbes picked companies with sales of $5 million to $750 million and a minimum stock price of $5 as of Sept. 29 for the list. The business magazine bases its ranking on return on equity, sales growth and profit growth in the past 12 months through Sept. 29 and also during a five-year period. Forbes also compares listed companies’ stock performances with that of their peers.
The list noted that Quality’s sales grew 39%, its earnings per share rose 49% and its return on equity increased 17% on average during the five years.
Quality Chairman Sheldon Razin said the company was pleased to be recognized for eight consecutive years by Forbes and that it was “gratified to be acknowledged” for the products and services it brings to its doctor and dentist customers.
Bits and Pieces:
Bank of America Business Capital said it provided $150 million in deal financing to Blackstone Group LP that was used to buy Lake Forest-based Apria Healthcare Group Inc. Blackstone, a New York private equity firm, paid a total of $1.7 billion for the home healthcare provider The Ueberroth Family Foundation has given $1 million to Hoag Memorial Hospital Presbyterian in Newport Beach to establish a women’s diabetes care program. Hoag plans to use the money to enhance its programs for diabetic women before, during and after pregnancy National Surgical Care, a Dallas operator of outpatient surgery centers, said it bought the Fullerton Surgical Center and a center in Florida for an undisclosed price. The centers’ surgical specialties include orthopedics, pain management, gastroenterology, podiatric surgery, general surgery and ear/nose/throat surgery Avid Bioservices Inc., a subsidiary of Tustin-based Peregrine Pharmaceuticals Inc., said that it installed a pair of bioreactors in a bid to meet growing demand for its cell culture production services Coast Radiology Imaging & Intervention, a Mission Viejo medical practice, said it renewed a contract with Zotec Partners, an Indiana-based medical billing company with an office in Santa Ana.
