News in brief - May 22/29, 2000

Specialists' pay cut upheld - Plans post solid earnings -- except for Humana - States eyeing drug prices - Standardized credentials OK'd

Specialists' pay cut upheld

Reductions in Medicare reimbursements for specialty procedures were upheld by the federal district court in Chicago on May 1. Procedure-based specialists expect to lose $495 million in Medicare and commercial reimbursements over four years.

The lawsuit filed by 11 specialty societies argued that federal law prohibits courts from examining the rates.

Plans post solid earnings -- except for Humana

Premium hikes boosted first-quarter earnings for many large managed health care companies. UnitedHealth Group, WellPoint Health Networks, Foundation Health Systems and Coventry Health Care posted higher earnings. Tufts Health Plan posted its first profits since 1998, and Oxford Health Plan's net income nearly tripled. One exception was Humana Inc., which posted a 37% drop.

States eyeing drug prices

The National Conference of State Legislatures reports that 28 states are considering ways to lower prescription drug costs, including buying pools, piggy-backing onto Medicaid drug discounts and price controls.

The report was released as Maine's Legislature passed a bill that would require drug prices to be reduced to Canadian levels.

Standardized credentials OK'd

A standardized credentialing application for Texas physicians has been adopted by seven companies: Aetna U.S. Healthcare, Blue Cross and Blue Shield of Texas, Cigna HealthCare, Humana Inc., PacifiCare Health Systems, Texas Health Choice and UnitedHealthcare. PPM raises money for expansion

ProMedCo Management Co. on May 8 said it had reached a revised agreement with affiliates of Goldman, Sachs & Co. to provide financing for the PPM's expansion. The New York investment bank will invest $42.5 million in the Fort Worth, Texas-based company, revised down from an original $55 million investment.

ProMedCo chairman Wayne Posey said he was disappointed in the reduced investment but gave no reason why the terms of the deal changed.