-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, DS6baZdQkcG4sj6EQc42dxtr/4daBHzRv6GYccELt23CnsrLwfp2Gx+E8D809Xkw t2fISCxeigl1lVS+eqKdoA== 0000914039-02-000186.txt : 20020501 0000914039-02-000186.hdr.sgml : 20020501 ACCESSION NUMBER: 0000914039-02-000186 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20020501 ITEM INFORMATION: Other events ITEM INFORMATION: Financial statements and exhibits FILED AS OF DATE: 20020501 FILER: COMPANY DATA: COMPANY CONFORMED NAME: OXFORD HEALTH PLANS INC CENTRAL INDEX KEY: 0000865084 STANDARD INDUSTRIAL CLASSIFICATION: HOSPITAL & MEDICAL SERVICE PLANS [6324] IRS NUMBER: 061118515 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-16437 FILM NUMBER: 02629978 BUSINESS ADDRESS: STREET 1: 48 MONROE TURNPIKE CITY: TRUMBULL STATE: CT ZIP: 06611 BUSINESS PHONE: 2034596000 MAIL ADDRESS: STREET 1: 48 MONROE TURNPIKE CITY: TRUMBULL STATE: CT ZIP: 06611 8-K 1 y60195e8-k.txt FORM 8-K UNITED STATES 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 1, 2002 OXFORD HEALTH PLANS, INC. - -------------------------------------------------------------------------------- (Exact name of registrant as specified in its charter) Delaware 0-19442 06-1118515 - -------------------------------------------------------------------------------- (State or other jurisdiction of (Commission (IRS Employer incorporation) File Number) Identification No.) 48 Monroe Turnpike, Trumbull, Connecticut 06611 - -------------------------------------------------------------------------------- (Address of principal executive offices) (Zip Code) (203) 459-6000 - -------------------------------------------------------------------------------- (Registrant's telephone number, including area code) ITEM 5. OTHER EVENTS. The Company's Press Release dated May 1, 2002 announcing its first quarter 2002 results of operations is attached as an Exhibit hereto and incorporated herein by reference. ITEM 7. Financial Statements and Exhibits (c) Exhibits 99(a) Earnings Press Release dated May 1, 2002 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. OXFORD HEALTH PLANS, INC. Date: May 1, 2002 By: /s/ MARC M. KOLE -------------------------------- MARC M. KOLE Senior Vice President and Chief Accounting Officer 3 OXFORD HEALTH PLANS, INC. AND SUBSIDIARIES EXHIBIT INDEX
Exhibit Page Number Description of Document Number - ------ ----------------------- ------ 99(a) Earnings Press Release dated May 1, 2002 5
4 EX-99.A 3 y60195ex99-a.txt EXHIBIT 99(A) EXHIBIT 99(a) For Further Information: Investor Contact: Gary Frazier/Deborah Abraham (203) 459-7331/6674 gfrazier@oxfordhealth.com / dabraham@oxfordhealth.com Media Contact: Maria Gordon-Shydlo (203) 459-7674 / mshydlo@oxfordhealth.com FOR IMMEDIATE RELEASE OXFORD HEALTH PLANS, INC. ANNOUNCES FIRST QUARTER 2002 RESULTS EPS OF $0.78; 20% OVER PRIOR YEAR PERIOD COMMERCIAL MEMBERSHIP AHEAD OF EXPECTATIONS 2002 FULL YEAR COMMERCIAL MEMBERSHIP GROWTH PROJECTION RAISED TO 4% TRUMBULL, CONNECTICUT, MAY 1, 2002 Oxford Health Plans, Inc. (NYSE: OHP) today announced net income of $71.4 million, $0.78 per diluted common share, for the quarter ended March 31, 2002, compared to net income of $67.6 million, $0.65 per diluted common share, for the same period last year. Revenue for the quarter was $1.17 billion, compared to $1.08 billion in the first quarter last year. Oxford's fully insured commercial membership, excluding the effect of its recent MedSpan acquisition, increased by approximately 19,700 members during the quarter to 1.392 million. Medicare membership declined 10,300 members to 67,500 as a result of the Company's January 1 withdrawal from Medicare in Nassau County, New York and all but one New Jersey County. The medical loss ratio for the quarter was 79.9% compared to 79.5% in the prior year quarter. "Oxford's timely new benefit plans, focus on service and health care affordability have resulted in significant and above expectation enrollment gains," Norman C. Payson, MD, Oxford's Chairman and CEO said. As of March 31, 2002, the Company had approximately $1.23 billion in current cash and marketable securities, including over $166 million at the Parent Company. On April 30, the Parent Company received a dividend of $57 million from its New York health plan based on fourth quarter 2001 results. "During the first quarter we repurchased 1.9 million common shares for $72 million. We believe our free cash position and future operating cash flows will support our continued share repurchase program with its remaining authority of $62 million and will allow us to increase the capital strength of our operating subsidiaries," said Kurt B. Thompson, Oxford's Chief Financial Officer. "We now believe our full year 2002 net fully insured commercial enrollment growth will be approximately 4%, exclusive of our recent MedSpan acquisition. Enrollment growth together with a medical loss ratio better than our expectations resulted in strong earnings for our first quarter," Payson added. 5 As previously announced, the Company will hold a conference call on Wednesday, May 1, 2002 at 9:00 am (Eastern Time) to review the results of the first quarter and discuss the outlook for the remainder of 2002. The public is invited to listen to this conference call by dialing 1-888-677-8170 (using the password "Oxford") at least 10 minutes prior to the start of the call. Individuals who dial in will be asked to identify themselves and their affiliations. Investors, analysts and the public are also invited to listen to the conference call over the Internet by visiting our website at www.oxfordhealth.com. To listen to this call live on the Internet, visit the investor page of Oxford's Web site at least 20 minutes early (to download and install any necessary audio software) Founded in 1984, Oxford Health Plans, Inc. provides health plans to employers and individuals in New York, New Jersey and Connecticut, through its direct sales force, independent insurance agents and brokers. Oxford's services include traditional health maintenance organizations, point-of-service plans, third party administration of employer-funded benefits plans and Medicare plans. CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS Certain statements in this press release, including statements concerning the Company's future fully-insured commercial enrollment growth, future free cash, future operating cash flows and share repurchase program, and future capital strength of its operating subsidiaries, and other statements contained herein regarding matters that are not historical facts, are forward-looking statements as defined in the Securities Exchange Act of 1934; and because such statements involve risks and uncertainties, actual results may differ materially from those expressed or implied by such forward-looking statements. Factors that could cause actual results to differ materially include, but are not limited to: - - Changes in Federal or State regulation relating to health care and health benefit plans, including proposed patient protection legislation and mandated benefits. - - The state of the economy. - - The impact of the September 11, 2001 terrorist attacks, subsequent cases of anthrax infection or exposure, and any future acts of terrorism or war. - - Rising medical costs or higher utilization of medical services, including higher out-of-network utilization under point-of-service plans and new drugs and technologies. - - Competitive pressure on the pricing of the Company's products, including acceptance of premium rate increases by the Company's commercial groups. - - Higher than expected administrative costs in operating the Company's business and the cost and impact on service of changing technologies. - - The ability of the Company to maintain risk transfer and other provider arrangements and the resolution of existing and future disputes over the reconciliations and performance under such arrangements. - - Any changes in the Company's estimates of its medical costs and expected cost trends. - - The impact of future developments in various litigation (including pending class and derivative actions filed against the Company and certain of its officers and directors, and other proceedings commenced against the Company and several employees by certain healthcare providers), class actions in Connecticut and New York and related litigation by the Connecticut Attorney General, regulatory proceedings and other governmental action (including the ongoing examination, investigation and review of the Company by various Federal and State authorities). - - The Company's ability to renew existing members and attract new members. - - The Company's ability to develop processes and systems to support its operations and any future growth and administer new health care benefit designs. - - Those factors included in the discussion under the caption "Business - Cautionary Statement Regarding Forward-Looking Statements" in the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 2001. 6 OXFORD HEALTH PLANS, INC. AND SUBSIDIARIES Consolidated Income Statements Three Months Ended March 31, 2002 and 2001 (In thousands, except per share, per member per month and membership highlights data)
Three Months Ended March 31, 2002 2001 ---------- ---------- Revenues: Premiums earned $1,144,144 $1,055,288 Third-party administration, net 3,824 3,076 Investment and other income, net 21,164 20,113 ---------- ---------- Total revenues 1,169,132 1,078,477 ---------- ---------- Expenses: Health care services 914,441 839,164 Marketing, general and administrative 130,188 118,531 Interest and other financing charges 3,208 6,059 ---------- ---------- Total expenses 1,047,837 963,754 ---------- ---------- Earnings before income taxes 121,295 114,723 Income tax expense 49,852 47,151 ---------- ---------- Net earnings $ 71,443 $ 67,572 ========== ========== Earnings per common share - basic $ 0.82 $ 0.69 ========== ========== Earnings per common share - diluted $ 0.78 $ 0.65 ========== ========== Weighted-average common shares outstanding-basic 87,431 98,354 Effect of dilutive securities: Stock options 4,646 4,890 ---------- ---------- Weighted-average common shares outstanding-diluted 92,077 103,244 ========== ========== SELECTED INFORMATION Medical loss ratio 79.9% 79.5% Administrative loss ratio 11.3% 11.2% Earnings before income taxes, financing charges, depreciation and amortization ("EBITDA") $ 129,403 $ 124,567 PMPM premium revenue $ 259.02 $ 243.35 PMPM medical expense $ 207.02 $ 193.51 Fully insured member months 4,417.2 4,336.5
As of March 31, ----------------------------- MEMBERSHIP HIGHLIGHTS 2002 2001 ---------- ---------- Freedom and Liberty Plans 1,204,900 1,138,500 HMO 236,700 222,200 ---------- ---------- Total Fully Insured Commercial 1,441,600(1) 1,360,700 Medicare 67,500 87,000 Third-party Administration 65,400(2) 56,400 ---------- ---------- Total Membership 1,574,500 1,504,100 ========== ==========
(1) Includes Fully Insured Commercial membership of 49,700 related to MedSpan. (2) Includes Third-party Administration membership of 22,400 related to MedSpan. OXFORD HEALTH PLANS, INC. AND SUBSIDIARIES Consolidated Balance Sheets As of March 31, 2002 and December 31, 2001 (In thousands, except share data)
March 31, Dec. 31, 2002 2001 ----------- ----------- ASSETS Current assets: Cash and cash equivalents $ 198,824 $ 345,530 Investments - available-for-sale, at market value 1,035,646 961,652 Premiums receivable, net 56,961 37,127 Other receivables 23,487 24,678 Prepaid expenses and other current assets 6,340 3,450 Deferred income taxes 82,764 83,416 ----------- ----------- Total current assets 1,404,022 1,455,853 Property and equipment, net 34,732 35,084 Deferred income taxes 14,348 8,348 Restricted cash and investments 58,879 58,813 Goodwill and other intangible assets 26,217 -- Other noncurrent assets 22,497 18,627 ----------- ----------- Total assets $ 1,560,695 $ 1,576,725 =========== =========== LIABILITIES AND SHAREHOLDERS' EQUITY Current liabilities: Medical costs payable $ 631,089 $ 595,064 Current portion of long term debt 27,344 26,250 Trade accounts payable and accrued expenses 138,447 116,601 Unearned revenue 158,309 201,225 Income taxes payable 7,470 47,789 ----------- ----------- Total current liabilities 962,659 986,929 Long-term debt 120,104 126,876 Shareholders' equity: Preferred stock, $.01 par value, authorized 2,000,000 shares -- -- Common stock, $.01 par value, authorized 400,000,000 shares; issued and outstanding 104,232,369 shares in 2002 and 100,353,007 shares in 2001 1,042 1,004 Additional paid-in capital 686,365 605,661 Retained earnings 286,608 215,165 Accumulated other comprehensive income 68 7,587 Treasury stock, at cost (496,151) (366,497) ----------- ----------- Total shareholders' equity 477,932 462,920 ----------- ----------- Total liabilities and shareholders' equity $ 1,560,695 $ 1,576,725 =========== ===========
OXFORD HEALTH PLANS, INC. AND SUBSIDIARIES Consolidated Statements of Cash Flows Three Months Ended March 31, 2002 and 2001 (In thousands)
Three Months Ended March 31, 2002 2001 ---------- ---------- Cash flows from operating activities: Net income $ 71,443 $ 67,572 Adjustments to reconcile net earnings to net cash provided by operating activities: Depreciation and amortization 5,178 3,785 Noncash income (3,800) -- Deferred income taxes 5,901 46,590 Realized gain on sale of investments (2,376) (1,818) Changes in assets and liabilities (net of balances acquired): Premiums receivable (16,163) (1,295) Other receivables 1,191 49,822 Prepaid expenses and other current assets 1,342 (372) Medical costs payable 11,498 3,759 Trade accounts payable and accrued expenses 8,198 212 Unearned revenue (41,619) 29,573 Income taxes payable (9,599) -- Other, net (2,653) (450) ---------- ---------- Net cash provided by operating activities 28,541 197,378 ---------- ---------- Cash flows from investing activities: Capital expenditures (3,459) (5,051) Purchases of investments (470,810) (189,141) Sales and maturities of investments 387,435 132,181 Acquisitions, net of cash acquired (1,898) -- ---------- ---------- Net cash used by investing activities (88,732) (62,011) ---------- ---------- Cash flows from financing activities: Proceeds from exercise of stock options 16,204 4,438 Redemption of notes payable (6,563) (5,469) Payments under capital leases -- (1,903) Payment of withholding tax on option exercises (24,056) -- Purchase of treasury shares (72,100) -- ---------- ---------- Net cash used by financing activities (86,515) (2,934) ---------- ---------- Net increase (decrease) in cash and cash equivalents (146,706) 132,433 Cash and cash equivalents at beginning of period 345,530 198,632 ---------- ---------- Cash and cash equivalents at end of period $ 198,824 $ 331,065 ========== ==========
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