MANAGED CARE January 2001. ©MediMedia USA
NEWS AND COMMENTARY
More HMOs to fold, consolidate in 2001
More than six dozen HMOs have characteristics that put them in danger of going out of business, according to projections by InterStudy publications. InterStudy looked at specific operational aspects of HMOs that shut down in 1999 and determined that 75 now operating fit the same mold. These characteristics of plans that ceased operations are significantly different from better-performing HMOs:
| Ceased operation in 1999 (Averages) | Rest of HMO industry (Averages) | |
| Enrollment per plan | 31,600 | 142,428 |
| Medical loss ratio | 92.3% | 88.5% |
| Administrative expense ratio | 17.4% | 14.1% |
| Operating profit/loss | –11.8% | –1.1% |
| Days of unpaid medical claims | 61 | 55 |
| SOURCE: NATIONAL HMO FINANCIAL DATABASE, INTERSTUDY PUBLICATIONS, ST. PAUL, MN., 2000 | ||
