TRUMBULL, Conn., April 26 /PRNewswire-FirstCall/ -- Oxford Health Plans, Inc. announced today net earnings of $86.7 million, or $1.03 per diluted share, for the quarter ended March 31, 2004, compared to $72.9 million, or $0.86 per diluted share, for the prior year quarter. The prior year results include a pretax charge of $45 million, or $0.32 per share after tax, for the settlement of the 1997 securities class action litigation. See Exhibit 1 of this release for a reconciliation of net earnings reported under generally accepted accounting principles to run rate earnings for the first quarter of 2004 compared to 2003.
“We are pleased with these financial results, as they continue to demonstrate the success of our overall strategy. Our customers value our broad portfolio of products, as well as the scope and quality of our provider network and service we provide,” commented Charles G. Berg, President and CEO of Oxford.
Business Highlights
Membership: Total fully insured commercial membership ended the quarter at 1.40 million members compared to 1.43 million members at the end of December 2003. The decline in fully insured commercial membership during the quarter was in line with management’s estimates. Medicare membership was 70,400 at the end of the quarter.
Premium Revenue: Premium revenue increased 5.6% in the first quarter to $1.38 billion from $1.31 billion in the first quarter of 2003. Commercial premiums increased 5.4% to $1.22 billion from $1.16 billion in the first quarter of 2003. During the first quarter of 2004 commercial premium yields increased approximately 9.9% over the prior year quarter. Commercial member months declined 4.1% for the quarter compared to the 2003 period. Medicare premiums were $167.1 million in the first quarter of 2004, compared to $155.4 million in the first quarter of 2003.
Investment and Other Income, net: Investment and other income, net, was $24.1 million in the first quarter of 2004, compared to $31.6 million in the first quarter of 2003. Realized gains for the quarter were $4.9 million in 2004, compared to $13.7 million in 2003. The net pre-tax yield on the Company’s investment portfolio was approximately 3.0% for the first quarter of 2004, compared to approximately 3.6% in the first quarter of 2003.
Health Care Services Expense: Health care services expense was $1.118 billion in the first quarter of 2004, compared to $1.034 billion in the first quarter of 2003. The first quarter of 2004 includes approximately $0.5 million of net favorable medical reserve estimate changes from prior periods compared to approximately $7.1 million in the first quarter of 2003. Commercial per member per month (PMPM) medical costs for the first quarter of 2004 increased approximately 11.8% compared to the 2003 first quarter. This increase reflects the reported PMPM commercial medical costs adjusted for net favorable development of commercial medical reserves of approximately $3.3 million and $8.0 million in the first quarter of 2004 and 2003, respectively, and the impact of one additional business day in the first quarter of 2004. Adjusting for the additional business day, commercial PMPM medical costs increased by approximately 10.7%. This increase was in line with management’s estimates for the quarter and is consistent with management’s estimate of a full year commercial PMPM medical trend between 9% and 10%.
The previously reported first quarter 2003 commercial PMPM medical costs increased only 8.4% over the first quarter of 2002, creating an atypical point of comparison for the current quarter’s results. The 2003 first quarter PMPM commercial medical cost increase was lower than expected at that time as a result of several one-time events affecting utilization in that quarter. The remaining three quarters of 2003 had higher medical cost trends and represent more normalized run rates for year-over-year analysis. Full year 2003 PMPM commercial medical cost trends were approximately 9.4%.
Marketing, General and Administrative (MG&A) Expenses: MG&A expenses were $147.3 million, resulting in an administrative loss ratio of 10.6% for the first quarter of 2004, compared to $142.3 million and a 10.8% administrative loss ratio in the first quarter of 2003. As a result of business mix changes and higher premium tax rates, broker commissions and premium taxes accounted for $50.8 million, or 34.5%, of total MG&A expenses for the first quarter of 2004, compared to $45.7 million, or 32.1%, of MG&A expenses in the first quarter of 2003. Excluding the increases in broker commissions and premium taxes, remaining MG&A expenses were essentially flat compared to the first quarter of 2003. (All dollar amounts and percentages cited in this paragraph for 2003 exclude the litigation charge for settlement presented in the accompanying income statement.)
Medical Costs Payable: Medical costs payable were $692.9 million as of March 31, 2004 compared to $671.5 million as of December 31, 2003. The $21.4 million increase during the quarter was primarily due to an increase in IBNR and unpaid claims reserves of $21.1 million. Days claims in medical costs payable ended the quarter at approximately 58 days, consistent with the level at December 31, 2003.
Cash Flow: Cash flow from operations was $65.1 million in the first quarter of 2004, compared to $114.1 million in the first quarter of 2003. Cash flow from operations for the first quarter of 2004 and 2003 includes only two months of Medicare premium receipts. Proforma for the January Medicare premiums received in December of each prior year, operating cash flows would have been $54.2 million and $50.2 million higher in 2004 and 2003, respectively. The decrease in operating cash flow from the prior year quarter was primarily due to the timing of income tax payments, increases in medical costs payments and the funding of certain accrued expenses. Net income for the first quarter of 2003 included a $45 million non-cash charge for litigation settlement.
Parent Cash Balances: Parent company cash and investments totaled $433.5 million at March 31, 2004, compared to $369 million at December 31, 2003. The increase during the quarter was primarily due to dividend receipts from regulated subsidiaries, income tax transfers from subsidiaries in excess of amounts due to taxing authorities and proceeds from stock option exercises. The Company currently has a $50 million dividend request under review by New York regulators.
Share Repurchase Program: As a result of the proposed merger between the Company and a wholly owned subsidiary of UnitedHealth Group, the Board of Directors of Oxford has terminated the Company’s share repurchase program. The Company did not repurchase any shares in the first quarter of 2004. The Company repurchased 23.8 million shares for $757.2 million since the inception of its share repurchase program in the third quarter of 2001.
Quarterly Dividend: The Company will pay a quarterly cash dividend of 10 cents per share on April 27, 2004 totaling $8.2 million, to shareholders of record as of April 12, 2004. The Company does not anticipate declaring any additional quarterly dividends at this time due to the proposed merger.
Conference Call and Webcast
The Company will hold a conference call today at 6:00 p.m. (Eastern Time) to review the results of the first quarter and to discuss management’s outlook for the balance of 2004. This call replaces the previously scheduled call on Thursday, April 29, 2004. The public is invited to listen to this conference call by dialing 1-888-452-0455 (using the passcode 3580340) 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 http://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).
About Oxford
Founded in 1984, Oxford Health Plans, Inc. provides health plans to employers and individuals primarily in New York, New Jersey and Connecticut, through its direct sales force, independent insurance agents and brokers. Oxford’s commercial insured products and services include traditional health maintenance organizations, preferred and exclusive provider organizations, point-of-service plans and consumer directed health plans. The Company also offers Medicare plans and third party administration of employer-funded benefits plans. More information about Oxford Health Plans, Inc. is available at http://www.oxfordhealth.com/.
Cautionary Statement Regarding Forward-Looking Statements
Certain statements in this press release, including statements concerning the Company’s strategy, product portfolio, provider networks 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. * The state of the economy. * 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, risk sharing, incentive 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 matters and the periodic 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 to administer new health care benefit designs. * Any future acts or threats of terrorism or war. * Those factors included in the discussion under the caption “Cautionary Statement Regarding Forward-Looking Statements” in Part I, Item 1, of the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2003 filed with the Securities and Exchange Commission. OXFORD HEALTH PLANS, INC. Consolidated Income Statements For the Three Months Ended March 31, 2004 and 2003 (In thousands, except per share, per member per month and membership highlights data) Unaudited Three Months Ended March 31, 2004 2003 Revenues: Premiums earned $1,384,248 $1,310,460 Third-party administration, net 2,888 3,117 Investment and other income, net 24,109 31,555 Total revenues 1,411,245 1,345,132 Expenses: Health care services 1,118,457 1,034,109 Marketing, general and administrative 147,275 142,250 Litigation charge for settlement - 45,000 Interest and other financing charges 4,594 2,228 Total expenses 1,270,326 1,223,587 Earnings before income taxes 140,919 121,545 Income tax expense 54,254 48,620 Net earnings $ 86,665 $ 72,925 Net earnings per common share - basic $ 1.07 $0.87 Net earnings per common share - diluted $1.03 $0.86 Dividends per common share $ 0.10 $ - Weighted-average common shares - basic 81,365 83,762 Dilutive effect of stock options 3,166 1,470 Weighted-average common shares - diluted 84,531 85,232 Selected Information Medical loss ratio 80.8% 78.9% Administrative loss ratio, excluding net litigation charge 10.6% 10.8% Earnings before income taxes, financing charges, depreciation and amortization (“EBITDA”) $ 152,407 $ 129,570 PMPM premium revenue $312.18 $283.99 PMPM medical expense $252.24 $224.10 Fully insured member months 4,434.1 4,614.5 As of March 31, Membership Highlights 2004 2003 POS, PPO and Other Plans 1,216,600 1,276,800 HMO 187,500 204,000 Total Fully Insured Commercial 1,404,100 1,480,800 Medicare 70,400 70,700 Third-party Administration 37,100 41,100 Total Membership 1,511,600 1,592,600 OXFORD HEALTH PLANS, INC. Consolidated Balance Sheets As of March 31, 2004 and December 31, 2003 (In thousands, except share data) Assets Unaudited March 31, December 31, 2004 2003 Current assets: Cash and cash equivalents $ 617,168 $ 536,510 Investments - available-for-sale, at market value 1,383,185 1,370,535 Premiums receivable, net 38,200 30,505 Other receivables 30,966 30,082 Prepaid expenses and other current assets 15,209 16,785 Deferred income taxes 36,329 45,240 Total current assets 2,121,057 2,029,657 Property and equipment, net 37,422 31,638 Deferred income taxes 9,390 9,572 Restricted cash and investments-held-to-maturity, at amortized cost 59,554 59,738 Goodwill and other intangible assets, net 21,161 21,785 Other noncurrent assets 6,394 7,811 Total assets $2,254,978 $2,160,201 Liabilities and Shareholders’ Equity Current liabilities: Medical costs payable $ 692,915 $ 671,515 Current portion of long term debt 4,000 4,000 Trade accounts payable and accrued expenses 146,861 138,925 Unearned revenue 144,971 187,751 Income taxes payable 45,340 30,530 Current portion of capital lease obligations 4,811 5,749 Total current liabilities 1,038,898 1,038,470 Obligations under capital lease - 467 Long-term debt 393,000 394,000 Shareholders’ equity: Preferred stock, $.01 par value, authorized 2,000,000 shares - - Common stock, $.01 par value, authorized 400,000,000 shares; issued 106,847,681 shares in 2004 and 106,612,822 shares in 2003 1,068 1,066 Additional paid-in capital 776,408 750,919 Retained earnings 859,369 780,856 Accumulated other comprehensive income 18,655 10,622 Unearned restricted stock unit compensation (16,221) - Treasury stock, at cost (816,199) (816,199) Total shareholders’ equity 823,080 727,264 Total liabilities and shareholders’ equity $2,254,978 $2,160,201 OXFORD HEALTH PLANS, INC. AND SUBSIDIARIES Consolidated Statements of Cash Flows For the Three Months Ended March 31, 2004 and 2003 (In thousands) Unaudited Three Months Ended March 31, 2004 2003 Cash flows from operating activities: Net income $ 86,665 $ 72,925 Adjustments to reconcile net earnings to net cash provided by operating activities: Depreciation and amortization 7,256 6,070 Noncash income (4,146) (4,146) Litigation and other noncash charges 274 45,000 Deferred income taxes 5,300 (11,240) Realized gain on sale of investments (4,854) (13,723) Changes in assets and liabilities: Premiums receivable (7,695) (7,736) Other receivables (884) 808 Prepaid expenses and other current assets 1,576 (5,520) Medical costs payable 21,400 56,353 Trade accounts payable and accrued expenses (15,994) (23,131) Income taxes payable 14,810 43,290 Unearned revenue (38,634) (45,229) Other, net (7) 427 Net cash provided by operating activities 65,067 114,148 Cash flows from investing activities: Capital expenditures (10,640) (3,588) Purchases of investments (394,401) (462,412) Sales and maturities of investments 423,404 457,677 Net cash provided (used) by investing activities 18,363 (8,323) Cash flows from financing activities: Proceeds from exercise of stock options 7,760 7,659 Payments under capital leases (1,405) (1,344) Redemption of notes payable (1,000) (7,656) Cash dividends paid (8,127) - Purchase of treasury shares - (24,237) Net cash used by financing activities (2,772) (25,578) Net increase in cash and cash equivalents 80,658 80,247 Cash and cash equivalents at beginning of period 536,510 321,627 Cash and cash equivalents at end of period $617,168 $401,874 Exhibit 1 OXFORD HEALTH PLANS, INC. AND SUBSIDIARIES Supplemental Schedule Reconciling GAAP Earnings to Run Rate Earnings For the Three Months Ended March 31, 2004 and 2003 (In thousands, except per share data) (Unaudited) Three Months Ended March 31, 2004 2003 Diluted earnings per common share - GAAP $ 1.03 $ 0.86 Effect of run rate adjustments: Litigation charge for settlement - 0.32 Changes in estimates of prior period medical cost reserves (0.01) (0.05) Diluted earnings per common share - Run Rate $1.02 $ 1.13 Diluted common shares 84,531 85,232 Three Months Ended March 31, 2004 2003 Net earnings - GAAP $86,665 $72,925 Effect of run rate adjustments: Litigation charge for settlement - 27,000 Changes in estimates of prior period medical cost reserves (307) (4,235) Net earnings - Run Rate $86,358 $95,690 Note: Exhibit 1 above reconciles the differences between run rate earnings and net earnings calculated and presented in accordance with generally accepted accounting principles (“GAAP”). Management believes that the presentation of run rate earnings provides useful information to investors regarding the Company’s results of operations because such presentation facilitates the period-to-period comparison of operating performance by eliminating charges for settlement of the 1997 securities class action litigation, which charges are unrelated to current period operating performance, and by eliminating, among other things, the current period impact of changes to the Company’s estimates of prior period medical cost reserves. Run Rate Adjustments for the Quarters Ended March 31, 2004 and 2003 During the first quarter of 2004, the Company had net favorable prior period reserve adjustments (“PPRAs”) of medical costs of approximately $0.5 million, compared to approximately $7.1 million in the first quarter of 2003. These PPRAs had a nominal $0.01 per share effect on reported net earnings for the first quarter of 2004 and increased first quarter 2003 earnings by $0.05 per share. Exhibit 2 OXFORD HEALTH PLANS, INC. AND SUBSIDIARIES Changes in Medical Costs Payable For the Three Months Ended March 31, 2004 and 2003 (In millions) (Unaudited) Amounts Relating to Three Months Ended March 31, 2004 Claims Incurred During Total 2004 2003 and Prior Balance as of December 31, 2003 $ 671.5 $ - $ 671.5 Components of health care services expense: Estimated costs incurred 1,119.0 1,119.0 - Estimate changes (0.5) - (0.5) Health care services expense 1,118.5 1,119.0 (0.5) Payments for health care services (1,097.1) (536.3) (560.8) Balance as of March 31, 2004 $ 692.9 $ 582.7 $ 110.2 Three Months Ended March 31, 2003 Amounts Relating to Claims Incurred During Total 2003 2002 and Prior Balance as of December 31, 2002 $ 618.6 $ - $ 618.6 Components of health care services expense: Estimated costs incurred 1,041.2 1,041.2 - Estimate changes (7.1) - (7.1) Health care services expense 1,034.1 1,041.2 (7.1) Payments for health care services (977.8) (506.3) (471.5) Balance as of March 31, 2003 $ 674.9 $ 534.9 $ 140.0 Changes in Medical Costs Payable During the first quarter of 2004, the Company incurred estimated health care services expenses of $1.12 billion compared to $1.04 billion in the first quarter of 2003, representing an increase of $78 million, or 7.5%. During the first quarter of 2004, net favorable PPRAs were $0.5 million compared to $7.1 million in 2003. The 2004 amounts were comprised of favorable development of $3.3 million on commercial reserves and unfavorable development of $2.8 million on Medicare reserves. The 2003 amounts were comprised of favorable development of $8.0 million on commercial reserves and unfavorable development of $0.9 million on Medicare reserves. Exhibit 3 OXFORD HEALTH PLANS, INC. AND SUBSIDIARIES COMPONENTS OF MEDICAL COSTS PAYABLE As of March 31, 2004 and 2003 and December 31, 2003 (In millions) (Unaudited) Amounts Relating to Claims Incurred During As of March 31, 2004 Total 2004 2003 and Prior IBNR and medical claims reserves $ 662.6 $ 551.5 $ 111.1 Pharmacy PBM payable 27.1 27.1 - Stabilization and stop-loss pools, BDCC and GME reserves, net 2.6 4.1 (1.5) Other reserves 0.6 - 0.6 Medical Costs Payable Balance $ 692.9 $ 582.7 $ 110.2 Amounts Relating to Claims Incurred During As of March 31, 2003 Total 2003 2002 and Prior IBNR and medical claims reserves $ 609.7 $ 505.2 $ 104.5 Pharmacy PBM payable 25.5 25.5 - Stabilization and stop-loss pools, BDCC and GME reserves, net 19.3 4.2 15.1 Other reserves 20.4 - 20.4 Medical Costs Payable Balance $ 674.9 $ 534.9 $ 140.0 Amounts Relating to Claims Incurred During As of December 31, 2003 Total 2003 2002 and Prior IBNR and medical claims reserves $ 641.5 $ 615.7 $ 25.8 Pharmacy PBM payable 27.8 27.8 - Stabilization and stop-loss pools, BDCC and GME reserves, net (4.9) (11.3) 6.4 Other reserves 7.1 - 7.1 Medical Costs Payable Balance $ 671.5 $ 632.2 $ 39.3 Definitions IBNR and medical claims reserves: Estimates of liabilities for incurred but unreported medical claims including in-house inventories, adjudicated but not yet paid claims, net liabilities under risk sharing arrangements and reserves for previously denied claims. Pharmacy PBM payable: Bi-weekly amounts due to the Company’s pharmacy benefit manager based on submission of pharmacy claims. Stabilization and stop-loss pools, BDCC and GME reserves, net: Estimated net liabilities (receivables) related to various state programs including New York market stabilization and stop-loss pools, bad debt and charity care and graduate medical education surcharges. Other reserves: Estimated liabilities for certain former medical contracts that are in various stages of resolution. Components of Medical Costs Payable During the first quarter of 2004, total medical costs payable increased $21.4 million from the balance at December 31, 2003. IBNR and medical claims reserves as of March 31, 2004 represented approximately 95.6% of total medical costs payable compared to 90.3% as of March 31, 2003. Other reserves declined during the quarter primarily as a result of settlement payments made to the Company’s former pharmacy benefit manager. Total days medical costs payable at March 31, 2004 and December 31, 2003 was approximately 58 days. Exhibit 4 OXFORD HEALTH PLANS, INC. AND SUBSIDIARIES SELECTED FINANCIAL STATISTICS (In millions, except PMPM data) (Unaudited) 2004 2003 1Q Full Year 4Q 3Q 2Q 1Q Commercial Premium Revenues $1,217.1 $4,706.8 $1,191.8 $1,186.0 $1,173.9 $1,155.1 Medicare Premium Revenues 167.1 632.5 159.9 159.8 157.4 155.4 Total Premium Revenues $1,384.2 $5,339.3 $1,351.7 $1,345.8 $1,331.3 $1,310.5 Commercial Medical Costs $ 973.6 $3,711.2 $ 935.8 $ 921.6 $ 950.3 $ 903.5 Medicare Medical Costs 144.9 531.2 130.7 131.9 138.0 130.6 Total Health Care Services Expense $1,118.5 $4,242.4 $1,066.5 $1,053.5 $1,088.3 $1,034.1 Commercial PMPM Revenue $ 288.27 $ 269.62 $ 276.44 $ 272.66 $ 267.20 $ 262.36 Medicare PMPM Revenue $ 788.38 $ 743.79 $ 751.34 $ 750.16 $ 740.10 $ 733.53 Commercial PMPM Medical Costs $ 230.60 $ 212.59 $ 217.06 $ 211.87 $ 216.31 $ 205.21 Medicare PMPM Medical Costs $ 683.21 $ 624.59 $ 614.02 $ 619.14 $ 648.80 $ 616.66 Commercial Medical Loss Ratio 80.0% 78.8% 78.5% 77.7% 81.0% 78.2% Medicare Medical Loss Ratio 86.7% 84.0% 81.7% 82.5% 87.7% 84.1% Total Medical Loss Ratio 80.8% 79.5% 78.9% 78.3% 81.7% 78.9% MG&A Expenses(1) $ 147.3 $ 575.1 $ 144.4 $ 143.7 $ 144.7 $ 142.3 Administrative Loss Ratio (ALR)(1) 10.6% 10.7% 10.7% 10.7% 10.8% 10.8% ALR Run Rate(2) 10.6% 10.7% 10.7% 10.7% 10.8% 10.8% 2002 Full Year Commercial Premium Revenues $ 4,265.8 Medicare Premium Revenues 585.2 Total Premium Revenues $ 4,851.0 Commercial Medical Costs $ 3,374.9 Medicare Medical Costs 473.9 Total Health Care Services Expense $ 3,848.8 Commercial PMPM Revenue $ 244.11 Medicare PMPM Revenue $ 710.36 Commercial PMPM Medical Costs $ 193.13 Medicare PMPM Medical Costs $ 575.26 Commercial Medical Loss Ratio 79.1% Medicare Medical Loss Ratio 81.0% Total Medical Loss Ratio 79.3% MG&A Expenses(1) $ 575.4 Administrative Loss Ratio (ALR)(1) 11.8% ALR Run Rate(2) 11.1% (1) - Excludes net litigation charges of ($151.3 million) in 2002 and ($45 million) in the first quarter of 2003, and $14.3 million of litigation insurance recoveries in the third quarter of 2003. (2) - Run Rate ALR excludes charges and recoveries related to the securities class action litigation settlement costs in the first quarter of 2003 ($45 million) and the recovery of $14.3 million in the third quarter of 2003. Full year 2002 excludes total charges and expenses of ($171.3 million) related the now settled securities litigation and ($15.5 million) for the termination charge related to the CSC contract. Selected Trends and Financial Statistics Commercial premium revenues increased $62 million over the first quarter of 2003. Commercial premium yields, net of product mix and benefit changes, increased approximately 9.9% over the first quarter of 2003. Medicare premiums increased $11.7 million over the first quarter of 2003 as a result of the mix of membership and increased reimbursement rates. Commercial per member per month (PMPM) medical costs for the first quarter of 2004 increased approximately 11.8% compared to the 2003 first quarter. This increase reflects the reported PMPM commercial medical costs adjusted for net favorable development of commercial medical reserves of approximately $3.3 million and $8.0 million in the first quarter of 2004 and 2003, respectively, and the impact of one additional business day in the first quarter of 2004. Adjusting for the additional business day, commercial PMPM medical costs increased by approximately 10.7%. This increase was in line with management’s estimates for the quarter and is consistent with management’s estimate of a full year commercial PMPM medical trend between 9% and 10%. The previously reported first quarter 2003 commercial PMPM medical costs increased only 8.4% over the first quarter of 2002, creating an atypical point of comparison for the current quarter’s results. The 2003 first quarter PMPM commercial medical cost increase was lower than expected at that time as a result of several one-time events affecting utilization in that quarter. The remaining three quarters of 2003 had higher medical cost trends and represent more normalized run rates for year-over-year analysis. Full year 2003 PMPM commercial medical cost trends were approximately 9.4%. Exhibit 5 OXFORD HEALTH PLANS, INC. AND SUBSIDIARIES MEMBERSHIP DATA (In thousands) (Unaudited) Total Ending Membership 2004 2003 2002 1Q 4Q 3Q 2Q 1Q 4Q POS, PPO and Other Plans 1,216.6 1,239.4 1,252.0 1,260.0 1,276.8 1,252.9 HMO 187.5 190.5 191.5 196.5 204.0 226.6 Total Fully Insured Commercial Membership 1,404.1 1,429.9 1,443.5 1,456.5 1,480.8 1,479.5 Medicare 70.4 70.8 71.0 70.9 70.7 70.1 Third-party Administration 37.1 38.5 39.8 40.8 41.1 51.9 Total Membership 1,511.6 1,539.2 1,554.3 1,568.2 1,592.6 1,601.5 Fully Insured Commercial Change (25.8) (13.6) (13.0) (24.3) 1.3 0.7 Fully Insured Commercial Change % -1.8% -0.9% -0.9% -1.6% 0.1% 0.0% Membership Total fully insured commercial membership ended the quarter at 1.404 million members compared to 1.430 million members at the end of December 2003. The decline in fully insured commercial membership for the first quarter of 2004 was in line with management’s expectations. Medicare membership remained relatively flat at 70,400 compared to 70,800 at December 31, 2003.
Oxford Health Plans, Inc.
CONTACT: Investor - Gary Frazier, +1-203-459-7331, or Jon Green,+1-203-459-6674, Media - Maria Gordon-Shydlo, +1-203-459-7674, all of OxfordHealth Plans, Inc.
Web site: http://www.oxfordhealth.com/
