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PacifiCare Increases 3Q Net 54% As Membership Drops 9.6%

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NU Online News Service, Nov. 6, 2003, 4:31 p.m. EST – PacifiCare Health Systems Inc., Cypress, Calif., says a big increase in the average amount of revenue it gets for commercial plan members helped it increase its third-quarter net income 54%.

The managed care company is reporting $67 million in net income for the latest quarter on $2.7 billion in revenue, up from $44 million in net income on $2.8 billion in revenue for the third quarter of 2002.

The company ended the quarter providing or administering coverage for 2.9 million people, 9.6% fewer than it covered a year earlier. The company lost some members due to a decision to withdraw from the California Public Employees’ Retirement System health plan.

But average commercial revenue per commercial plan member increased 15%, to $577.

Because average revenue per member was so much higher, the ratio of medical claims costs to premiums fell to 83.6%, from 85.5% for the third quarter of 2002, PacifiCare says.