NU Online News Service, Aug. 1, 5:33 p.m. – Oxford Health Plans Inc., Trumbull, Conn., is reporting $53 million in net income for the second quarter on $1.2 billion in revenue, compared with $75 million in net income on $1.2 billion in revenue for the second quarter of 2001.
Net results for the latest quarter include a $7.7 million charge to cover the cost of payments Oxford will be making to get out of a computer services outsourcing arrangement, along with $7.7 million in a write-off of the value of computer systems used in connection with the outsourcing arrangement.
Oxford, like PacifiCare Health Systems Inc., Cypress, Calif., is also writing off the value of some of its investment in MedUnite Inc., San Diego, a managed care industry consortium that is trying to develop electronic communications systems that will link physicians with health insurance carriers.
A spokeswoman for MedUnite said the consortium is moving ahead with efforts to introduce its communications services and suggested the write-offs might reflect a new, more conservative approach to accounting for investments.
“MedUnite is fully functional, fully staffed and remains dedicated to alleviating the medical paperwork burden of the healthcare community,” the spokeswoman said in a statement. “Our founders our strong believers in our business model and remain firmly committed to our goal.”
Representatives for Oxford and PacifiCare were not immediately available for comment.
Oxford ended the second quarter providing or administering major medical coverage for 1.6 million people, up from 1.5 million people a year earlier.
Average premium revenue per fully insured commercial member increased 4.2%, to $818.