-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: keymaster@town.hall.org Originator-Key-Asymmetric: MFkwCgYEVQgBAQICAgADSwAwSAJBALeWW4xDV4i7+b6+UyPn5RtObb1cJ7VkACDq pKb9/DClgTKIm08lCfoilvi9Wl4SODbR1+1waHhiGmeZO8OdgLUCAwEAAQ== MIC-Info: RSA-MD5,RSA, Q+Tmdt8tPOC0hrXlxXamvAYkxeEUwhGHpuYYXSCRLIH0UTITz7tI8QTvQ50VlGnV plUuN11nDNPABFX4ZFCCDA== 0000950131-95-001119.txt : 19950505 0000950131-95-001119.hdr.sgml : 19950505 ACCESSION NUMBER: 0000950131-95-001119 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 3 CONFORMED PERIOD OF REPORT: 19950504 ITEM INFORMATION: Other events ITEM INFORMATION: Financial statements and exhibits FILED AS OF DATE: 19950504 SROS: NYSE FILER: COMPANY DATA: COMPANY CONFORMED NAME: UNITED HEALTHCARE CORP CENTRAL INDEX KEY: 0000731766 STANDARD INDUSTRIAL CLASSIFICATION: HOSPITAL & MEDICAL SERVICE PLANS [6324] IRS NUMBER: 411321939 STATE OF INCORPORATION: MN FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-10864 FILM NUMBER: 95534377 BUSINESS ADDRESS: STREET 1: 300 OPUS CENTER STREET 2: 9900 BREN ROAD EAST CITY: MINNETONKA STATE: MN ZIP: 55343 BUSINESS PHONE: 6129361300 8-K 1 FORM 8-K 05-04-95 SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D. C. 20549 ---------- FORM 8-K CURRENT REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934 Date of Report (Date of earliest event reported): MAY 4, 1995 ----------- UNITED HEALTHCARE CORPORATION ----------------------------- (exact name of registrant as specified in charter) MINNESOTA --------- (State or other jurisdiction of incorporation) 0-13253 41-1321939 ------- ---------- (Commission File Number) (IRS Employer Identification No.) 300 OPUS CENTER, 9900 BREN ROAD EAST, MINNETONKA, MN 55343 --------------------------------------------------------------- (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code: (612) 936-1300 -------------- Item 5. Other Events - --------------------- On May 4, 1995, the Registrant announced its financial results for the first quarter ended March 31, 1995. Item 7. Financial Statements, Pro Forma Financial Information and Exhibits. - ---------------------------------------------------------------------------- (c) Exhibits - --- -------- Exhibit 99.1- United HealthCare Corporation Press Release, dated May 4, 1995. Exhibit 99.2 - Supplemental Financial Schedules related to financial results for the first quarter ended March 31, 1995. 2 SIGNATURES ---------- Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. UNITED HEALTHCARE CORPORATION ----------------------------- (Registrant) By /s/ David P. Koppe ------------------------------------------- David P. Koppe Chief Financial Officer Date: May 4, 1995 3 EXHIBIT INDEX Exhibit Number Description Page No. - -------------- ----------- -------- 99.1 United HealthCare Corporation Press Release dated 5 May 4, 1995. 99.2 Supplemental Financial Schedules related to financial 11 results for the first quarter ended March 31, 1995. 4 EX-99.1 2 UHC PRESS RELEASE 5-4-95 CONTACTS: David Koppe, CFO (612) 936-7211 Bernard McDonagh Vice President, Investor Relations (612) 936-7214 Noreen Conway, Vice President Public Relations & Communications (612) 936-1126 (For Immediate Release) UNITED HEALTHCARE REPORTS STRONG FIRST QUARTER RESULTS EARNINGS GROWTH DRIVEN BY STRONG ENROLLMENT GAINS, CONTINUED CONTROL OF MEDICAL EXPENSES MEDICAL LOSS RATIO DECLINES TO 78.0 PERCENT MINNEAPOLIS (May 4, 1995) -- United HealthCare Corporation (NYSE:UNH) today announced record earnings for the first quarter ended March 31, 1995. First quarter net earnings were $89.4 million, up 27.0 percent from net earnings of $70.4 million for last year's first quarter, with earnings per share of $0.51, a 27.5 percent increase over $0.40 reported for the first quarter of 1994. Revenues for the first quarter were $1.104 billion, a 22.2 percent increase over the $903.6 million reported for first quarter 1994. The company's first quarter 1995 medical loss ratio (medical costs as a percent of premium revenues) was 78.0 percent. This was down sequentially from both the 78.1 percent reported for the fourth quarter 1994 and the 78.2 percent reported for the same (more) United HealthCare Corporation First Quarter Results May 4, 1995 -- p. 2 period one year ago. These results are especially positive considering that historically the company has experienced higher medical utilization in the first quarter. United HealthCare Chairman and CEO William W. McGuire, M.D., said, "We are pleased with our continuing success at controlling medical costs, realizing good operating margins and sustaining strong growth. The company's discipline of effectively managing its costs and pricing to these costs remains intact. We also believe that the potential for future medical cost reduction is strong in all of our health plans." The first quarter of 1995 includes the post-acquisition results of GenCare Health Systems, Inc. and Group Sales and Service of Puerto Rico, Inc.. These purchases were completed on January 3 and February 28, 1995, respectively. ADDITIONAL HIGHLIGHTS - --------------------- MEDICAL COSTS. The company saw no unusual increases in its major medical expense categories in the first quarter of 1995. Hospital utilization, as measured in bed days per 1000 enrollees, decreased in the aggregate across the company's owned health plan markets as compared to the first quarter of 1994. Primary care and specialist physician costs, as well as outpatient costs, also remained generally stable with the year-ago quarter. Contributing to this control of medical costs are the company's extended experience with its various product lines, most of which have been offered for several years; strong market positions which contribute to favorable long-term contracts; a positive approach to providers; and its information systems capabilities. "We remain diligent in monitoring our medical costs and believe that we have identified appropriate areas for ongoing improvement," said Dr. McGuire. SG&A COSTS. For the first quarter of 1995, the company's total SG&A costs as a percent of total revenue were 14.3 percent, down significantly from the 15.9 percent (more) United HealthCare Corporation First Quarter Results May 4, 1995 -- p. 3 reported for the first quarter one year ago and up from the 13.5 percent reported for the fourth quarter of 1994. SG&A costs for owned health plans were 10.8 percent of revenue, down from 10.9 percent for the first quarter of 1994 and up from 10.3 percent for the fourth quarter of 1994. The sequential increase in these costs for the health plans can be attributed to increased spending of about $5 million in a number of areas, including spending on developing Medicare and Medicaid initiatives. In addition, the company is investing in a variety of new non-health plan endeavors that have not yet produced significant offsetting revenue. These efforts include managed care programs for the aged, information services for health care providers, and international business opportunities. Expenses related to these non-health plan programs exceeded $5 million, or approximately $0.02 per share, during the first quarter. ENROLLMENT. Compared to March 31, 1994, first quarter 1995 enrollment in the company's owned health plans grew by 1,140,400 members (including acquisitions), or 73.0 percent, ending the quarter at 2,702,000 members. For all health plans owned as of March 31, 1995, internal growth totalled 379,000 members, or 16.3 percent, for the 12-month period ended March 31, 1995. While pleased with the first quarter enrollment results, Dr. McGuire said that the company has not yet benefited from its increased focus on Medicare or state-led Medicaid initiatives. The company stated that while uncertainties remain regarding the various states' timing and rate of implementation of many of the Medicaid programs, it believes that these programs, coupled with several major commercial accounts recently awarded, ongoing strength and emerging opportunities in the small-group and point-of- service products, and the enhanced Medicare efforts, should serve as a base for strong enrollment growth through the remainder of 1995 and into 1996. (more) United HealthCare Corporation First Quarter Results May 4, 1995 -- p. 4 HIGHLIGHTS OF FIRST QUARTER RESULTS
QUARTER ENDED ------------------------------------- 3/31/94 12/31/94 3/31/95 ---------- ---------- ---------- Premium revenue $805.0 mil $877.3 mil $1.004 bil Medical loss ratio 78.2% 78.1% 78.0% (percent of premium rev.) SG&A (percent of revenue) Total 15.9% 13.5% 14.3% Health Plan 10.9% 10.3% 10.8% Enrollment -- Owned (restated for pooled acquisitions) Commercial 1,660,000 1,791,000 2,291,000 Medicare 99,000 109,000 114,000 Medicaid 252,000 285,000 297,000 ---------- ---------- ---------- Total Owned 2,011,000 2,185,000 2,702,000 Enrollment -- Managed Commercial 885,000 940,000 1,033,000 Medicare 78,000 77,000 76,000 Medicaid 45,000 47,000 52,000 ---------- ---------- ---------- Total Managed 1,008,000 1,064,000 1,161,000 Total Enrollment 3,019,000 3,249,000 3,863,000 $ (000's) Cash & Investments $1,192,472 $2,769,390 $2,433,823 Medical Payables $ 455,627 $ 443,559 $ 479,027 Shareholders' Equity $1,160,051 $2,795,456 $2,903,719
"We are very pleased with our performance this quarter," said Dr. McGuire. "In the face of minimal premium increases, we have continued to control our medical costs, resulting in continuation of our pattern of strong earnings growth. At the same time, we (more) United HealthCare Corporation First Quarter Results May 4, 1995 -- p. 5 continue to commit significant personnel resources and dollars to new product opportunities which we believe hold significant opportunity for the company. This approach of new business development coupled with ongoing efforts to improve our existing products and services should help us continue to realize long-term growth and superior performance." United HealthCare Corporation is a national leader in health care management, serving purchasers, users, managers and providers of health care since 1974. The company's broad range of products is offered through 21 locally-based owned and managed health plans, whose membership exceeds 3.8 million, and its non-geographically bounded specialty care management companies, which serve the needs of an additional 25 million-plus lives. # # # # # UNITED HEALTHCARE CORPORATION EARNINGS REPORT* (IN THOUSANDS, EXCEPT PER SHARE DATA)
THREE MONTHS ENDED MARCH 31, 1995 MARCH 31, 1994 -------------- -------------- Revenues $1,103,835 $903,556 Net earnings $ 89,432 $ 70,398 Net earnings per share $ 0.51 $ 0.40 Average number of common shares outstanding 176,403 174,507
* The financial information for the quarter ended March 31, 1994, has been restated to include the results of Ramsay-HMO, Inc. and Complete Health Services, Inc. in accordance with pooling of interests accounting. The Ramsay and Complete mergers occurred on May 31, 1994. First quarter 1995 results include the post-acquisition results of GenCare and Group Sales and Services of Puerto Rico, purchased on January 3 and February 28, respectively. EX-99.2 3 SUPPL. FINANCIAL SCHEDULE SCHEDULE A UNITED HEALTHCARE CORPORATION QUARTERLY ANALYSIS FOR THE QUARTER ENDED 03/31/95 (Unaudited) (000's)
% CHANGE 3 MONTHS ENDED % 3 MONTHS ENDED % 03/31/94 to 03/31/95 (2) REVENUE 03/31/94 REVENUE 03/31/95 -------------- ------- -------------- ------- ----------- REVENUES: PREMIUM ......................................... $1,004,489 91.0% $804,991 89.1% 24.8% MANAGEMENT SERVICES ............................. 65,224 5.9% 81,422 9.0% (19.9%) INVESTMENT INCOME................................ 34,122 3.1% 17,143 1.9% 99.0% ---------- ------ -------- ------ ------ TOTAL REVENUES ................................ 1,103,835 100.0% 903,556 100.0% 22.2% ---------- ------ -------- ------ ------ OPERATING EXPENSES: MEDICAL COSTS (1) ............................... 783,501 78.0%(1) 629,578 78.2%(1) 24.4% SELLING, GENERAL & ADMINISTRATION ............... 157,578 14.3% 143,366 15.9% 9.9% DEPRECIATION & AMORTIZATION ..................... 19,665 1.8% 15,903 1.8% 23.7% ---------- ------ -------- ------ ------ TOTAL OPERATING EXPENSES ...................... 960,744 87.0% 788,847 87.3% 21.8% ---------- ------ -------- ------ ------ EARNINGS FROM OPERATIONS ............................ 143,091 13.0% 114,709 12.7% 24.7% INTEREST EXPENSE .................................... (180) (568) (68.3%) ---------- -------- ------ EARNINGS BEFORE INCOME TAXES AND MINORITY INTERESTS.......................................... 142,911 114,141 25.2% PROVISION FOR INCOME TAXES .......................... (52,878) (43,067) 22.8% MINORITY INTERESTS .................................. (601) (676) (11.1%) ---------- -------- ------ NET EARNINGS ........................................ $ 89,432 $ 70,398 27.0% ========== ======== ====== WEIGHTED AVERAGE NUMBER OF COMMON SHARES OUTSTANDING: 176,403 174,507 1.1% ========== ======== ====== EARNINGS PER SHARE: $ 0.51 $ 0.40 27.5% ========== ======== ======
Note: All periods presented have been restated to include the results of Ramsay HMO Inc., and Complete Health Services Inc. in accordance with pooling of interests accounting. The Ramsay and Complete mergers occurred on May 31, 1994. (1) Ratio of medical costs to premium revenue. Ratio includes health plans and United Behavioral Systems. (2) Includes post acquisition operating results of GenCare Health Systems, Inc. acquired on January 3, 1995 and Group Sales and Service of Puerto Rico, Inc. acquired on February 28, 1995.
SCHEDULE B UNITED HEALTHCARE CORPORATION QUARTERLY TREND ANALYSIS (Unaudited) (000's) % CHG FROM 1ST QTR % 2ND QTR % 1ST QTR 3RD QTR 1994 REVENUE 1994 REVENUE 1994 1994 -------- ------- -------- ------- ---------- -------- REVENUES: PREMIUM.................................... $804,991 89.1% $ 835,702 89.0% 3.8% $858,226 MANAGEMENT SERVICES ....................... 81,422 9.0% 77,552 8.2% (4.8%) 59,820 INVESTMENT INCOME.......................... 17,143 1.9% 26,211 2.8% 52.9% 38,786 -------- ------ ---------- ------ ---------- -------- TOTAL REVENUES............................. 903,556 100.0% 939,465 100.0% 4.0% 956,834 -------- ------ ---------- ------ ---------- -------- OPERATING EXPENSES: MEDICAL COSTS (1) ......................... 629,578 78.2%(1) 652,266 78.1%(1) 3.6% 675,650 SELLING, GENERAL & ADMIN................... 143,366 15.9% 148,168 15.8% 3.3% 133,462 DEPRECIATION & AMORT....................... 15,903 1.8% 16,378 1.7% 3.0% 16,258 -------- ------ ---------- ------ ---------- -------- TOTAL OPERATING EXPENSES................... 788,847 87.3% 816,812 86.9% 3.5% 825,370 -------- ------ ---------- ------ ---------- -------- EARNINGS FROM OPERATIONS...................... 114,709 12.7% 122,653 13.1% 6.9% 131,464 INTEREST EXPENSE.............................. (568) (569) 0.2% (413) MERGER COSTS (2) ............................ -- (35,940)(2) -- -- -------- ---------- ---------- -------- EARNINGS BEFORE INCOME TAXES, MINORITY INTERESTS AND EXTRAORDINARY GAIN............. 114,141 86,144 (24.5%) 131,051 PROVISION FOR INCOME TAXES.................... (43,067) (33,031) (23.3%) (49,810) MINORITY INTERESTS............................ (676) (457) -- (399) -------- ---------- ---------- -------- NET EARNINGS BEFORE EXTRAORDINARY GAIN........ 70,398 52,656(2) See Note(2) 80,842 EXTRAORDINARY GAIN ON SALE OF SUBSIDIARY, NET OF INCOME TAXES OF $808,758 (3).......... -- 1,377,075(3) -- -------- ---------- -------- NET EARNINGS ................................. $ 70,398 $1,429,731 $ 80,842 ======== ========== ======== WEIGHTED AVERAGE NUMBER OF COMMON SHARES OUTSTANDING: 174,507 175,490 0.6% 176,038 ======== ========== ========== ======== EARNINGS PER SHARE: NET EARNINGS BEFORE EXTRAORDINARY GAIN (2) $ 0.40 $ 0.30(2) See Note(2) $ 0.46 EXTRAORDINARY GAIN (3) -- 7.85(3) -- -------- ---------- -------- NET EARNINGS PER SHARE $ 0.40 $ 8.15 $ 0.46 ======== ========== ========
% CHG FROM % CHG FROM % 2ND QTR 4TH QTR % 3RD QTR 1ST QTR REVENUE 1994 1994 REVENUE 1994 1995(4) -------- ---------- -------- ------- ---------- -------- REVENUES: PREMIUM.................................... 89.7% 2.7% $ 877,317 90.5% 2.2% $1,004,489 MANAGEMENT SERVICES ....................... 6.3% (22.9%) 55,822 5.8% (6.7%) 65,224 INVESTMENT INCOME.......................... 4.0% 48.0% 35,888 3.7% (7.5%) 34,122 -------- ---------- ---------- ------ ---------- ---------- TOTAL REVENUES............................. 100.0% 1.8% 969,027 100.0% 1.3% 1,103,835 -------- ---------- ---------- ------ ---------- -------- OPERATING EXPENSES: MEDICAL COSTS (1) ......................... 78.7%(1) 3.6% 685,613 78.1%(1) 1.5% 783,501 SELLING, GENERAL & ADMIN................... 13.9% (9.9%) 130,653 13.5% (2.1%) 157,578 DEPRECIATION & AMORT....................... 1.7% (0.7%) 15,540 1.6% (4.4%) 19,665 -------- ---------- ---------- ------ ---------- -------- TOTAL OPERATING EXPENSES................... 86.3% 1.0% 831,806 85.8% 0.8% 960,744 -------- ---------- ---------- ------ ---------- -------- EARNINGS FROM OPERATIONS...................... 13.7% 7.2% 137,221 14.2% 4.4% 143,091 INTEREST EXPENSE.............................. (27.4%) (613) 48.4% (180) MERGER COSTS (2) ............................ -- -- -- -- ---------- ---------- ---------- -------- EARNINGS BEFORE INCOME TAXES, MINORITY INTERESTS AND EXTRAORDINARY GAIN............. 52.1% 136,608 4.2% 142,911 PROVISION FOR INCOME TAXES.................... 50.8% (51,914) 4.2% (52,878) MINORITY INTERESTS............................ -- (451) -- (601) ---------- ---------- ---------- -------- NET EARNINGS BEFORE EXTRAORDINARY GAIN........ See Note(2) 84,243 4.2% 89,432 EXTRAORDINARY GAIN ON SALE OF SUBSIDIARY, NET OF INCOME TAXES OF $808,758 (3).......... -- -- ---------- -------- NET EARNINGS ................................. $ 84,243 4.2% $ 89,432 ========== ========== ======== WEIGHTED AVERAGE NUMBER OF COMMON SHARES OUTSTANDING: 0.3% 176,573 0.3% 176,403 ========== ========== ========== ======== EARNINGS PER SHARE: NET EARNINGS BEFORE EXTRAORDINARY GAIN (2) See Note(2) $ 0.48 4.3% $ 0.51 EXTRAORDINARY GAIN (3) -- -- ---------- -------- NET EARNINGS PER SHARE $ 0.48 $ 0.51 ========== ========
% CHG FROM % 4TH QTR REVENUE 1994 -------- ---------- REVENUES: PREMIUM.................................... 91.0% 14.5% MANAGEMENT SERVICES ....................... 5.9% 16.8% INVESTMENT INCOME.......................... 3.1% (4.9%) -------- ------ TOTAL REVENUES............................. 100.0% 13.9% -------- ------ OPERATING EXPENSES: MEDICAL COSTS (1) ......................... 78.0%(1) 14.3% SELLING, GENERAL & ADMIN................... 14.3% 20.6% DEPRECIATION & AMORT....................... 1.8% 26.5% -------- ------ TOTAL OPERATING EXPENSES................... 87.0% 15.5% -------- ------ EARNINGS FROM OPERATIONS...................... 13.0% 4.3% INTEREST EXPENSE.............................. (70.6%) MERGER COSTS (2) ............................ -- ------ EARNINGS BEFORE INCOME TAXES, MINORITY INTERESTS AND EXTRAORDINARY GAIN............. 4.6% PROVISION FOR INCOME TAXES.................... 1.9% MINORITY INTERESTS............................ -- ------ NET EARNINGS BEFORE EXTRAORDINARY GAIN........ 6.2% EXTRAORDINARY GAIN ON SALE OF SUBSIDIARY, NET OF INCOME TAXES OF $808,758 (3).......... NET EARNINGS ................................. 6.2% ====== WEIGHTED AVERAGE NUMBER OF COMMON SHARES OUTSTANDING: (0.1%) ====== EARNINGS PER SHARE: NET EARNINGS BEFORE EXTRAORDINARY GAIN (2) 6.3% EXTRAORDINARY GAIN (3) NET EARNINGS PER SHARE
[FN] Note: All periods presented have been restated to include the results of Ramsay HMO Inc., and Complete Health Services Inc. in accordance with pooling of interests accounting. The Ramsay and Complete mergers occurred on May 31, 1994. (1) Ratio of medical costs to premium revenue. Ratio includes health plans and United Behavioral Systems. (2) Second quarter 1994 merger costs include professional fees and other direct costs associated with the May, 1994 merger of United HealthCare Corporation and Ramsay HMO Inc., & Complete Health Services Inc. These costs were $35.9 million before tax, $22.3 million after tax, and reduced net earnings per share before extraordinary gain by $.13. (3) On May 27, 1994, the Company completed the sale of its subsidiary Diversified Pharmaceutical Services to SmithKline Beecham for $2.3 billion, resulting in a net after tax gain of $1.38 billion or $7.85 EPS for the quarter. Post disposition results of DPS are not included. (4) Includes post acquisition operating results of GenCare Health Systems, Inc. acquired on January 3, 1995 and Group Sales and Service of Puerto Rico, Inc. acquired on February 28, 1995. SCHEDULE C UNITED HEALTHCARE CORPORATION QUARTERLY ANALYSIS FOR THE QUARTER ENDED 03/31/95 LINE OF BUSINESS SUMMARY (Unaudited) (000's)
% CHANGE 3 MONTHS ENDED % 3 MONTHS ENDED % 03/31/94 to 03/31/95 (1) OF TOTAL 03/31/94 OF TOTAL 03/31/95 -------------- -------- -------------- -------- ----------- REVENUES - -------- OWNED HEALTH PLANS $1,005,782 91.1% $803,251 88.9% 25.2% MANAGED HEALTH PLAN AND SPECIALTY SERVICES 92,812(2) 8.4% 149,824 16.6% (38.1%)(2) CORPORATE, ELIMINATIONS AND OTHER 5,241 0.5% (49,519) (5.5%) -- ---------- ------ -------- ------ ------ TOTAL REVENUE $1,103,835 100.0% $903,556 100.0% 22.2% ========== ====== ======== ====== ====== OPERATING INCOME - ---------------- OWNED HEALTH PLANS $ 107,145 74.9% $ 82,651 72.1% 29.6% MANAGED HEALTH PLAN AND SPECIALTY SERVICES 17,176(2) 12.0% 23,443 20.4% (26.7%)(2) CORPORATE, ELIMINATIONS AND OTHER 18,770 13.1% 8,615 7.5% -- ---------- ------ -------- ------ ------ TOTAL OPERATING INCOME $ 143,091 100.0% $114,709 100.0% 24.7% ========== ====== ======== ====== ====== OPERATING MARGIN - ---------------- OWNED HEALTH PLANS 10.7% 10.3% MANAGED HEALTH PLAN AND SPECIALTY SERVICES 18.5% 15.6% ---------- -------- TOTAL OPERATING MARGIN 13.0% 12.7% ========== ========
Note: All periods presented have been restated to include the results of Ramsay HMO Inc., and Complete Health Services Inc. in accordance with pooling of interests accounting. The Ramsay and Complete mergers occurred on May 31, 1994. (1) Includes post acquisition operating results of GenCare Health Systems, Inc. acquired on January 3, 1995 and Group Sales and Service of Puerto Rico, Inc. acquired on February 28, 1995. (2) Excludes the post disposition results of Diversified Pharmaceutical Services, which was sold on May 27, 1994. SCHEDULE D UNITED HEALTHCARE CORPORATION LINE OF BUSINESS SUMMARY - HISTORY (000's)
1994 =================================================================================== 1ST QTR % OF 2ND QTR % OF % CHG FROM 3RD QTR % OF % CHG FROM TOTAL TOTAL 1ST QTR 94 TOTAL 2ND QTR 94 ----------------------------------------------------------------------------------- REVENUES OWNED HEALTH PLANS $803,251 88.9% $831,819 88.5% 3.6% $852,746 89.1% 2.5% MANAGED HEALTH PLAN AND SPECIALTY SERVICES (1) 149,824 16.6% 133,892(1) 14.3% (10.6%) 86,392(1) 9.0% (35.5%) CORPORATE, ELIMINATIONS AND OTHER (49,519) (5.5%) (26,246) (2.8%) ------ 17,696 10.9% ------ ----------------------------------------------------------------------------------- TOTAL REVENUE $903,556 100.0% $939,465 100.0% 4.0% $956,834 100.0% 1.8% =================================================================================== OPERATING INCOME OWNED HEALTH PLANS $ 82,651 72.1% $ 85,231 69.5% 3.1% $ 88,141 67.0% 3.4% MANAGED HEALTH PLAN AND SPECIALTY SERVICES (1) 23,443 20.4% 19,687(1) 16.0% (16.0%) 14,242(1) 10.9% (27.7%) CORPORATE, ELIMINATIONS AND OTHER 8,615 7.5% 17,735 14.5% ------ 29,081 22.1% ------ ----------------------------------------------------------------------------------- TOTAL OPERATING INCOME $114,709 100.0% $122,653 100.0% 6.9% $131,464 100.0% 7.2% =================================================================================== OPERATING MARGIN OWNED HEALTH PLANS 10.3% 10.2% 10.3% MANAGED HEALTH PLAN AND SPECIALTY SERVICES (1) 15.6% 14.7%(1) 16.5%(1) -------- -------- -------- TOTAL OPERATING MARGIN 12.7% 13.1% 13.7% ======== ======== ======== FOR INFORMATION PURPOSES ONLY - ----------------------------- INVESTMENT INCOME INCLUDED IN LINE OF BUSINESS ABOVE: OWNED HEALTH PLANS $ 7,869 $ 8,471 7.7% $ 8,447 (0.3%) CORPORATE, ELIMINATIONS AND OTHER 9,274 17,740 91.3% 30,339 71.0% ----------------------------------------------------------------------------------- TOTAL INVESTMENT INCOME $ 17,143 $ 26,211 52.9% $ 38,786 48.0% =================================================================================== RATIOS - ------------------------------------- COMBINED SG & A RATIO (2) 10.9% 10.9% 10.6% HEALTH PLAN MEDICAL LOSS RATIO (3) 79.5% 79.1% 79.4%
1995 ================================ ================================================= 4TH QTR % OF % CHG FROM 1ST QTR % OF % CHG FROM % CHG FROM TOTAL 3RD QTR 94 TOTAL 4TH QTR 94 1ST QTR 94 -------------------------------- ------------------------------------------------- REVENUES OWNED HEALTH PLANS $870,730 89.9% 2.1% $1,005,782(4) 91.1% 15.5% 25.2% MANAGED HEALTH PLAN AND SPECIALTY SERVICES (1) 86,001(1) 8.9% (0.5%) 92,812(1) 8.4% 7.9% (38.1%) CORPORATE, ELIMINATIONS AND OTHER 12,296 1.2% --------- 5,241 0.5% --------- --------- -------------------------------- ------------------------------------------------- TOTAL REVENUE $969,027 100.0% 1.3% $1,103,835 100.0% 13.9% 22.2% ================================ ================================================= OPERATING INCOME OWNED HEALTH PLANS $ 96,038 70.0% 9.0% $ 107,145(4) 74.9% 11.6% 29.6% MANAGED HEALTH PLAN AND SPECIALTY SERVICES (1) 14,622(1) 10.7% 2.7% 17,176(1) 12.0% 17.5% (26.7%) CORPORATE, ELIMINATIONS AND OTHER 26,561 19.3% --------- 18,770 13.1% --------- --------- -------------------------------- ------------------------------------------------- TOTAL OPERATING INCOME $137,221 100.0% 4.4% $ 143,091 100.0% 4.3% 24.7% ================================ ================================================= OPERATING MARGIN OWNED HEALTH PLANS 11.0% 10.7% MANAGED HEALTH PLAN AND SPECIALTY SERVICES (1) 17.0%(1) 18.5% ----------- ----------- TOTAL OPERATING MARGIN 14.2% 13.0% =========== =========== FOR INFORMATION PURPOSES ONLY INVESTMENT INCOME INCLUDED IN LINE OF BUSINESS ABOVE: OWNED HEALTH PLANS 9,906 17.3% $ 12,387 25.0% 57.4% CORPORATE, ELIMINATIONS AND OTHER 25,982 (14.4%) 21,735 (16.3%) 134.4% -------------------------------- ------------------------------------------------- TOTAL INVESTMENT INCOME $ 35,888 (7.5%) $ 34,122 (4.9%) 99.0% ================================ ================================================= RATIOS - ------------------------------------------ COMBINED SG & A RATIO (2) 10.3% 10.8% HEALTH PLAN MEDICAL LOSS RATIO (3) 79.1% 78.9%
Note: All periods presented have been restated to include the results of Ramsay HMO Inc., and Complete Health Services Inc. in accordance with pooling of interests accounting. The Ramsay and Complete mergers occurred on May 31, 1994. (1) Excludes the post disposition results of Diversified Pharmaceutical Services, which was sold on May 27, 1994. (2) Total selling, general & administrative expense for Owned and Managed Health Plans as a percent of combined premium revenue for Owned and Managed Health Plans. (3) Ratio for owned health plans only. (4) Includes post acquisition operating results of GenCare Health Systems, Inc. acquired on January 3, 1995 and Group Sales and Service of Puerto Rico, Inc. acquired on February 28, 1995.
SCHEDULE E UNITED HEALTHCARE CORPORATION QUARTERLY ANALYSIS BALANCE SHEET (Unaudited) (000's) SUMMARY BALANCE SHEET 12/31/91 12/31/92(1) 03/31/93(2) 06/30/93 09/30/93 12/31/93 _____________________ --------- ------------- ------------ ------------ ------------ ------------ CASH & SHORT-TERM INVESTMENTS $341,404 $ 411,716 $ 340,737 $ 263,282 $ 238,121 $ 400,870 OTHER CURRENT ASSETS 103,253 125,780 172,342 198,358 197,715 213,098 LONG-TERM INVESTMENTS 174,770 511,860 586,627 691,210 762,939 768,563 OTHER LONG-TERM ASSETS 182,046 271,818 365,295 372,045 376,214 404,823 -------- ---------- ---------- ---------- ---------- ---------- TOTAL ASSETS $801,473 $1,321,174 $1,465,001 $1,524,895 $1,574,989 $1,787,354 ======== ========== ========== ========== ========== ========== MEDICAL SERVICES PAYABLE $223,741 $ 328,592 $ 391,625 $ 398,587 $ 401,578 $ 459,201 UNEARNED PREMIUMS 42,343 60,808 30,308 32,293 20,456 70,844 OTHER CURRENT LIABILITIES/INCOME TAXES PAYABLE 64,603 81,240 126,987 122,879 121,025 128,689 TAXES PAYABLE - GAIN ON SALE OF SUBSIDIARY -- -- -- -- -- -- OTHER LONG-TERM LIABILITIES 41,649 24,132 42,044 41,032 40,095 39,099 -------- ---------- ---------- ---------- ---------- ---------- TOTAL LIABILITIES 372,336 494,772 590,964 594,791 583,154 697,833 MINORITY INTERESTS 2,341 3,499 4,103 3,091 3,536 4,111 SHAREHOLDERS' EQUITY 426,796 822,903 869,934 927,013 988,299 1,085,410 -------- ---------- ---------- ---------- ---------- ---------- TOTAL LIABILITIES & EQUITY $801,473 $1,321,174 $1,465,001 $1,524,895 $1,574,989 $1,787,354 ======== ========== ========== ========== ========== ==========
SUMMARY BALANCE SHEET 03/31/94 06/30/94(3) 09/30/94 12/31/94 03/31/95(4) _____________________ ---------- ------------- ------------ ------------ ------------ CASH & SHORT-TERM INVESTMENTS $ 377,628 $2,347,177 $1,843,727 $1,654,336 $ 945,073 OTHER CURRENT ASSETS 231,924 238,019 218,874 253,879 276,678 LONG-TERM INVESTMENTS 814,844 1,032,524 1,020,897 1,115,054 1,488,750 OTHER LONG-TERM ASSETS 460,127 448,672 445,559 466,210 990,330 ---------- ---------- ---------- ---------- ---------- TOTAL ASSETS $1,884,523 $4,066,392 $3,529,057 $3,489,479 $3,700,831 ========== ========== ========== ========== ========== MEDICAL SERVICES PAYABLE $ 455,627 $ 441,043 $ 437,174 $ 443,559 $ 479,027 UNEARNED PREMIUMS 76,174 31,018 68,300 70,718 87,911 OTHER CURRENT LIABILITIES/INCOME TAXES PAYABLE 149,624 155,486 120,899 134,025 199,186 TAXES PAYABLE - GAIN ON SALE OF SUBSIDIARY -- 808,758 171,758 16,000 -- OTHER LONG-TERM LIABILITIES 38,259 27,123 23,956 24,275 25,142 ---------- ---------- ---------- ---------- ---------- TOTAL LIABILITIES 719,684 1,463,428 822,087 688,577 791,266 MINORITY INTERESTS 4,788 5,048 5,197 5,446 5,846 SHAREHOLDERS' EQUITY 1,160,051 2,597,916 2,701,773 2,795,456 2,903,719 ---------- ---------- ---------- ---------- ---------- TOTAL LIABILITIES & EQUITY $1,884,523 $4,066,392 $3,529,057 $3,489,479 $3,700,831 ========== ========== ========== ========== ==========
Note: All periods presented have been restated to include the results of HMO America, Inc., Ramsay HMO Inc., and Complete Health Services Inc. in accordance with pooling of interests accounting. UHC and HMO America merged on August 31, 1993. The Ramsay and Complete mergers occurred on May 31, 1994. (1) Physicians Health Plan of Ohio, Inc. (Columbus, OH) was acquired in January, 1992. Also, the Company completed a public offering of 5,000,000 shares of common stock in March, 1992, raising net proceeds of approximately $196,000,000. (2) Western Ohio HealthCare Corporation (Dayton, OH) was acquired in January, 1993. (3) On May 27, 1994, the Company completed the sale of its subsidiary Diversified Pharmaceutical Services to SmithKline Beecham for $2.3 billion, resulting in a net after tax gain of $1.38 billion or $7.86 EPS. (4) GenCare Health Systems, Inc. (St. Louis) was acquired in January, 1995. Group Sales and Service of Puerto Rico, Inc. was acquired in February, 1995.
SCHEDULE F UNITED HEALTHCARE CORPORATION QUARTERLY TREND ANALYSIS ENROLLMENT DEC JAN MAR DEC HEALTH PLANS 1993 1994 1994 1994 - ----------------------------------------------------- ----------- ----------- ----------- ----------- OWNED (1) - COMMERCIAL INSURED 1,459,000 1,526,000 1,542,000 1,668,000 SELF FUNDED 62,000 113,000 118,000 123,000 ---------- ---------- ---------- ---------- TOTAL COMMERCIAL 1,521,000 1,639,000 1,660,000 1,791,000 - MEDICARE 98,000 98,000 99,000 109,000 - MEDICAID 239,000 239,000 252,000 285,000 ---------- ---------- ---------- ---------- TOTAL OWNED ENROLLMENT 1,858,000 1,976,000 2,011,000 2,185,000 MANAGED - COMMERCIAL INSURED 742,000 753,000 760,000 796,000 SELF FUNDED 110,000 118,000 125,000 144,000 ---------- ---------- ---------- ---------- TOTAL COMMERCIAL 852,000 871,000 885,000 940,000 - MEDICARE 79,000 79,000 78,000 77,000 - MEDICAID 46,000 45,000 45,000 47,000 ---------- ---------- ---------- ---------- TOTAL MANAGED ENROLLMENT 977,000 995,000 1,008,000 1,064,000 TOTAL - COMMERCIAL INSURED 2,201,000 2,279,000 2,302,000 2,464,000 SELF FUNDED 172,000 231,000 243,000 267,000 ---------- ---------- ---------- ---------- TOTAL COMMERCIAL 2,373,000 2,510,000 2,545,000 2,731,000 - MEDICARE 177,000 177,000 177,000 186,000 - MEDICAID 285,000 284,000 297,000 332,000 ---------- ---------- ---------- ---------- 2,835,000 2,971,000 3,019,000 3,249,000 ========== ========== ========== ========== SPECIALTY MANAGED CARE SERVICES COMPANIES - ------------------------------------------------------- UNITED BEHAVIORAL SYSTEMS 2,373,000 2,618,000 2,710,000 2,962,000 HEALTHMARC 1,863,000 1,863,000 1,852,000 2,144,000 UNITED RESOURCE NETWORKS 12,885,000 13,087,000 13,289,000 15,633,000 INSTITUTE FOR HUMAN RESOURCES 2,078,000 2,385,000 2,367,000 2,585,000 % CHANGE % CHANGE JAN MAR DEC 94 to MAR 94 to HEALTH PLANS 1995 (2) 1995 (3) MAR 95 MAR 95 - ------------------------------------------------------- ----------- ----------- ----------- ----------- OWNED (1) - COMMERCIAL INSURED 1,940,000 2,094,000 25.5% 35.8% SELF FUNDED 193,000(2) 197,000 60.2%(2) 66.9%(2) ---------- ---------- ---------- ---------- TOTAL COMMERCIAL 2,133,000 2,291,000 27.9% 38.0% - MEDICARE 111,000 114,000 4.6% 15.2% - MEDICAID 291,000 297,000 4.2% 17.9% ---------- ---------- ---------- ---------- TOTAL OWNED ENROLLMENT 2,535,000 2,702,000 23.7% 34.4% MANAGED - COMMERCIAL INSURED 845,000 862,000 8.3% 13.4% SELF FUNDED 167,000 171,000 18.8% 36.8% ---------- ---------- ---------- ---------- TOTAL COMMERCIAL 1,012,000 1,033,000 9.9% 16.7% - MEDICARE 77,000 76,000 -1.3% -2.6% - MEDICAID 50,000 52,000 10.6% 15.6% ---------- ---------- ---------- ---------- TOTAL MANAGED ENROLLMENT 1,139,000 1,161,000 9.1% 15.2% TOTAL - COMMERCIAL INSURED 2,785,000 2,956,000 20.0% 28.4% SELF FUNDED 360,000 368,000 37.8% 51.4% ---------- ---------- ---------- ---------- TOTAL COMMERCIAL 3,145,000 3,324,000 21.7% 30.6% - MEDICARE 188,000 190,000 2.2% 7.3% - MEDICAID 341,000 349,000 5.1% 17.5% ---------- ---------- ---------- ---------- TOTAL HEALTH PLANS 3,674,000 3,863,000 18.9% 28.0% ========== ========== ========== ========== SPECIALTY MANAGED CARE SERVICES COMPANIES _________________________________________ UNITED BEHAVIORAL SYSTEMS 3,074,000 3,228,000 9.0% 19.1% HEALTHMARC 2,235,000 2,001,000 -6.7% 8.0% UNITED RESOURCE NETWORKS 15,986,000 16,240,000 3.9% 22.2% INSTITUTE FOR HUMAN RESOURCES 2,804,000 2,917,000 12.8% 23.2% (1) Consistent with pooling accounting, all periods presented have been restated to include the enrollment of Ramsay HMO Inc., and Complete Health Services Inc. The Ramsay and Complete mergers occurred on May 31, 1994. (2) Includes GenCare Health Systems, Inc. acquired on January 3, 1995. GenCare had 230,000 enrollees (39,800 self funded enrollees) as of January, 1995. Consistent with purchase accounting, no prior period restatement was made. (3) Group Sales and Service (133,000 enrollees as of March, 1995) was acquired on February 28, 1995. Consistent with purchase accounting, no prior restatement was made.
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