Financial Stability Of HMOs Called A Mixed Bag

An HCIA-Sachs survey says the median HMO profit margin in 1998 was –1.7 percent, slightly better than in 1997. Forty-one percent of HMOs made money in 1998.

Some marquee organizations are rebounding. Not-for-profit Kaiser Permanente ended 1999 with a net loss of $6 million, far from its $288 million net loss in 1998. On the for-profit side, Foundation Health's net income in 1999 was $142 million, compared with a net $165 million loss the previous year.

Many others, however, are still struggling. Aetna Inc. said it would split into separate "health and wealth" businesses — evoking memories of days before Aetna's corporate culture smothered U.S. Healthcare's inventiveness, say some observers. Aetna spurned a purchase offer from WellPoint Health Networks, opting instead for the restructuring plan.

In Massachusetts, Harvard Pilgrim Health Care will continue as a not-for-profit entity, after state officials restructured its debt and agreed its business plan was solid enough to get it into the black by next year. Some large for-profit plans that had considered buying Harvard Pilgrim subsequently expressed concern about entering Massachusetts, where opposition to for-profit care is strong.

Career Opportunities

HAP, a subsidiary of Henry Ford Health System, is a nonprofit health plan providing coverage to individuals, companies and organizations. This executive develops strategies to meet membership and revenue targets through products, pricing, market segmentation and advertising.  Aligns business among Business Development, Commercial Sales, Medicare and Public Sector Programs and Product Development. Seeks to enhance and be responsible for business development and expansion through the development of an effective product portfolio, strong interpersonal relationships and service excellence.

Apply via email to or online at

Subscribe to Our Newsletters

Monthly table of contents

Be notified as each issue of Managed Care is available online.

Biweekly newsletter

Recent topics have included:

PTCommunity news

New drug approvals, clinical trials, drug management. Three times per week.