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Fitch Ratings Updates Quantitative Ratings on HMOs

Posted on: Monday, 1 August 2005, 12:00 CDT

Fitch Ratings has updated the Quantitative Insurer Financial Strength (Q-IFS) ratings assigned to Health Maintenance Organization (HMO) companies in the U.S., resulting in 130 rating affirmations, 34 rating upgrades, six rating downgrades, 14 ratings withdrawn, and 23 initial Q-IFS ratings were assigned.

The update of Fitch's Q-IFS ratings was based on statutory financial information through year-end 2004, and reflects a sustained improvement in the earnings and capital profile of the HMO sector, modest membership growth and reduced exposure to government programs. The ratings continue to reflect the relatively modest capital levels maintained by HMO companies and inherently limited diversification.

'The HMO sector reported very strong financial results in 2004. The HMOs that have been assigned a Q-IFS rating reported a material improvement in operating margins -- 4.1% in 2004 vs. 3.8% in 2003. The improvement in earnings, which led to an improvement in capitalization, was the primary factor driving the increased number of upgrades', states Douglas L. Meyer, Senior Director at Fitch Ratings.

Q-IFS ratings are generated using a model that utilizes statutory financial statement information that individual companies file with state regulators. The model incorporates 'rating logic' that mirrors many aspects of the quantitative analysis that is used to assign traditional IFS ratings. Traditional IFS ratings incorporate both quantitative and qualitative factors and typically involve in-depth discussions with senior management. The Q-IFS ratings incorporate a 'q' subscript to differentiate the ratings from traditional IFS ratings.

While recognizing the limitations associated with using a strict quantitative rating approach, Fitch believes that Quantitative IFS ratings will provide a reasonable representation of the HMO's ratings will provide a reasonable representation of the HMO's stand-alone financial strength and operating profile.

Quantitative Insurer Financial Strength Ratings Affirmed

Entity/NAIC Code/Current Rating

Advantage Health Solutions Inc. (IN)/52568/'BBq';

Alliance For Community Health LLC (MO)/95609/'BBq';

Alliant Health Plans Inc (GA)/11256/'Bq';

Aloha Care (HI)/95853/'BBq';

Amerigroup FL Inc (FL)/95093/'Bq';

Amerigroup IL Inc (IL)/95372/'BBq';

Amerigroup MD Inc (DC)/95832/'BBq';

Amerigroup NJ (NJ)/95373/'BBq';

Amerihealth HMO Inc (PA)/95044/'BBBq';

Arnett HMO Inc (IN)/95440/'BBq';

Athens Area Health Plan Select Inc (GA)/95691/'Bq';

Atrium Health Plan Inc (WI)/95451/'BBq';

Avera Health Plans Inc (SD)/95839/'Bq';

Bluegrass Family Health Inc (KY)/95071/'BBq';

Cape Health Plan Inc (MI)/95759/'BBq';

Capital Care Inc (VA)/11227/'Bq';

Capital District Physicians' Health Plan, Inc. (NY)/95491/'BBBq';

Carefirst Bluechoice Inc (DC)/96202/'Aq';

Cariten Health Plan Inc (TN)/95754 /'BBq';

Carolina Care Plan Inc (SC)/95732/'BBq';

Children's Mercy Family Health Partners (MO)/95636/'CCCq';

Colorado Access (CO)/95733/'BBq';

Community Health Choice Inc (TX)/95615/'BBq';

Community Health Plan (MO)/95145/'Bq';

Community Health Plan of Ohio Inc (OH)/95193/'Bq';

Companion Healthcare Corp (SC)/95741/'BBBq';

Cook Childrens Health Plan (TX)/95822/'BBq';

Coordinated Care Corp Indiana Inc (IN)/95831/'BBq';

Cox Health System HMO Inc (MO)/ 95530/'Bq';

Dayton Area Health Plan (OH)/95201/'BBq';

DC Chartered Health Plan Inc (DC)/95748/'BBq';

Delmarva Health Plan Inc (MD)/95574/'Bq';

Denver Health Medical Plan Inc (CO)/95750/'Bq';

Driscoll Childrens Health Plan (TX)/95809/'Bq';

Educators Health Care (UT)/95515/'Bq';

El Paso First Health Plans Inc (TX)/52635/'Bq';

Elder Health Maryland HMO Inc (MD)/10095/'Bq';

Elder Health Pennsylvania HMO Inc (PA)/11524/'Bq';

Evergreen Health Plan Inc (GA)/95837/'Bq';

Family Health Plan Inc (OH)/96865/'Bq';

Firstguard Health Plan Inc (MO)/95364/'BBq';

Firstguard Health Plan KS Inc (KS)/95620/'BBq';

Florida Health Care Plan Inc (FL)/95124/'BBBq';

Gateway Health Plan Inc (PA)/96938/'BBq';

Ghi HMO Inc (NY)/95835/'Bq';

Good Health HMO Inc. (MO)/95315/'BBBq';

Group Health Coop of Eau Claire (WI)/95192/'Bq';

Group Health Coop of S Central WI (WI)/95311/'BBBq';

Group Health Cooperative (WA)/95672/'Aq';

Gundersen Lutheran Health Plan Inc (WI)/95101/'BBq';

Harmony Health Plan of IL Inc (IL)/11229/'BBq';

Health Alliance Midwest Inc (IL)/95513/'Bq';

Health Alliance Plan of Michigan (MI)/95844/'Aq';

Health First Health Plans Inc (FL)/95019/'BBq';

Health Partners of Philadelphia Inc (PA)/95066/'BBq';

Health Plan of MI Inc (MI)/52563/'BBq';

Health Plus of Louisiana Inc (LA)/95009/'Bq';

Health Right Inc (DC)/95787/'Bq';

Health Tradition Health Plan (WI)/96628/'BBq';

Healthease of FL Inc (FL)/52631/'CCCq';

Healthplus of Michigan Inc (MI)/95580/'BBq';

Healthspring of AL Inc (AL)/95781/'Bq';

Healthy Palm Beaches Inc (FL)/95827/'Bq';

Heart of America Health Plan (ND)/52554/'Bq';

HMO of Northeastern Pennsylvania (PA)/96601/'BBBq';

HMO Partners Inc (AR)/95442/'BBBq';

Horizon Healthcare of NJ Inc (NJ)/95529/'BBBq';

Horizon Healthcare of NY Inc (NY)/95854/'Bq';

IHC Health Plans Inc (UT)/95153/'BBBq';

Independent Health Association Inc (NY)/95308/'Aq';

John Deere Health Plan Inc (IL)/95378/'BBBq';

Keystone Health Plan Central Inc (PA)/95199/'BBBq';

Keystone Health Plan East Inc (PA)/95056/'BBBq';

M Care Inc (MI)/95449/'BBBq';

Managed Health Services Insurance Corp (WI)/96822/'BBq';

Medical Association Clinic Health Plan of Wisconsin (WI)/95782/'Bq';

Medical Associates Health Plan Inc (IA)/52559/'BBq';

Medical Health Insuring Corp of OH (OH)/95828/'BBq';

Midwest Health Plan Inc (MI)/95814/'BBq';

MNM 1997 Inc (TX)/95247/'Bq';

Molina Healthcare of Michigan (MI)/52630/'BBq';

Molina Healthcare of New Mexico (NM)/95739/'BBq';

Molina Healthcare of Washington Inc (WA)/96270/'BBq';

Molina Healthcare of Utah Inc. (UT)/95502/'BBq';

Mount Carmel Health Plan Inc (OH)/95655/'Bq';

Neighborhood Health Plan of RI Inc (RI)/95402/'BBq';

Nevada Care Inc (NV)/95244/'BBq';

Optima Health Group Inc (VA)/95481/'Bq';

Optima Health Plan (VA)/95281/'BBBq';

Paramount Care of MI Inc (MI)/95566/'Bq';

PHP Insurance Plan Inc (WI)/95587/'Bq';

Physician Health Plan of Southern Michigan (MI)/52564/'BBq';

Physicians Health Plan Inc (MI)/95849/'BBBq';

Physicians Health Plan of Northern Indiana Inc (IN)/95436/'BBq';

Physicians Health Plan of Southwest Michigan, Inc (MI)/52569/'BBq';

Physicians Plus Insurance Corp (WI)/95341/'BBBq';

Piedmont Comm Healthcare Inc (VA)/95811/'Bq';

Preferred Care Partners Inc (FL)/11176/'CCCq';

Preferred Health Partnership TN Inc (TN)/95749/'BBq';

Preferred Medical Plan Inc (FL)/95271/'BBq';

Preferred One Comm Health Plan (ME)/95724/'BBq';

Premier Health Inc. (KS)/95254/'BBq';

Priority Health Government Programs (MI)/11520/'BBq';

Private Medical Care of AZ Inc (AZ)/95366/'Bq';

QCA Health Plan Inc (AR)/95448/'Bq';

Safeguard Health Plans Inc (NV)/95747/'Bq';

Safeguard Health Plans Inc (TX)/95051/'Bq';

San Luis Valley HMO Inc (CO)/95774/'Bq';

Scott & White Health Plan (TX)/95099/'BBBq';

Selectcare of TX LLC (TX)/10096/'Bq';

Seton Health Plan Inc (TX)/95240/'Bq';

Sha LLC (TX)/95138/'Bq';

Sioux Valley Health Plan (SD)/95683/'Bq';

Sioux Valley Health Plan of Minnesota (MN)/95725/'Bq';

South Dakota State Medical Holding Company (SD)/96598/'BBq';

Sun Health Medisun Inc (AZ)/95982/'Bq';

Three Rivers Health Plans Inc (PA)/95220/'BBq';

Total Health Care Inc (MI)/95644/'BBq';

Total Health Choice Inc (FL)/95134/'Bq';

Ultimed HMO of MI (MI)/95751/'Bq';

Union Health Services Inc (IL)/52553/'BBq';

University Health Care Inc (KY)/52621/'BBq';

Utmb Health Plans Inc (TX)/95764/'BBq';

Valley Baptist Health Plan Inc (TX)/95801/'Bq';

Value Options of TX Inc (TX)/95799/'Bq';

Vantage Health Plan Inc (LA)/95584/'Bq';

Virginia Premier Health Plan Inc (VA)/95612/'BBq';

Viva Health Inc (AL)/95322/'BBq';

Wellmark Health Plan of IA Inc (IA)/95531/'BBBq';

Winhealth Partners (WY)/95401/'Bq';

Quantitative Insurer Financial Strength Ratings Upgraded

Entity/NAIC Code/Prior Rating/Current Rating

Amerigroup Texas Inc (TX)/95314/'Bq'/'BBq';

Avmed Inc (FL)/95263/'BBq'/'Aq';

Blue Care Network of Michigan (MI)/95610/'BBBq'/'Aq';

Community First Health Plans Inc (TX)/95248/'Bq'/'BBq';

Empire Healthchoice HMO Inc (NY)/95433/'Bq'/'BBBq';

Fallon Community Health Plan Inc (MA)/95541/'BBBq'/'Aq';

First Medical Health Plan Inc (PR)/95722/'CCCq'/'BBq';

Firstchoice Healthplans of Connecticut, Inc (CT)/95310/'Bq'/'BBq';

Health New England Inc (MA)/95673/'Bq'/'BBq';

HealthWise (UT)/95303/'Bq'/'BBq';

HMO Louisiana Inc (LA)/95643/'BBBq'/'Aq';

HMO Minnesota (MN)/95649/'BBBq'/'Aq';

IU Health Plan Inc (IN)/95807/'Bq'/'BBq';

M Plan Inc (IN)/95444/'Bq'/'BBq';

Mercy Health Plans MO Inc (MO)/95309/'BBq'/'BBBq';

Missouri Care Health Plan (MO)/95715/'Bq'/'BBq';

Network Health Plan of WI Inc (WI)/95737/'BBq'/'BBBq';

Parkland Community Health Plan Inc (TX)/95414/'CCCq'/'Bq';

Plan Medico UTI De PR Inc (PR)/95746/'Bq'/'BBq';

Preferred Plus of Kansas Inc (KS)/95390/'BBq'/'BBBq';

Priority Health (MI)/95561/'BBBq'/'Aq';

Saint Marys Health First (NV)/95793/'Bq'/'BBq';

Security Health Plan of Wisconsin Inc (WI)/96881/'BBq'/'BBBq';

Select Health of South Carolina Inc (SC)/95458/'Bq'/'BBq';

Summacare Inc (OH)/95202/'BBq'/'BBBq';

Superior HealthPlan Inc (TX)/95647/'Bq'/'BBq';

Tenet Choices Inc (LA)/95690/'Bq'/'BBq';

The Health Plan of the Upper Ohio Valley, Inc. (WV)/95677/'BBq'/'BBBq';

Tufts Associated HMO Inc (MA)/95688/'BBBq'/'Aq';

Ucare Minnesota (MN)/52629/'BBq'/'BBBq';

University Health Plans Inc (NJ)/95503/'Bq'/'BBq';

Upper Peninsula Health Plan (MI)/52615/'Bq'/'BBq';

Well Care of FL Inc (FL)/95081/'CCCq'/'Bq';

Wellcare of New York Inc (NY)/95534/'BBq'/'BBBq';

Quantitative Insurer Financial Strength Ratings Downgraded

Entity/NAIC Code/Prior Rating/Current Rating

Amil International TX Inc (TX)/95594/'Bq'/'CCCq';

CHA HMO Inc (KY)/95158/'BBBq'/'BBq';

Healthguard of Lancaster Inc (PA)/95443/'BBq'/'Bq';

Mmm Healthcare Inc (PR)/11157/'Bq'/'CCCq';

MVP Health Plan Inc (NY)/95521/'BBBq'/'BBq';

Paramount Health Care (OH)/95189/'BBBq'/'BBq';

Quantitative Insurer Financial Strength Ratings Assigned

Entity/NAIC Code/Prior Rating/Current Rating

Advantage Healthplan Inc (DC)/95803/'NR'/'Bq';

America's Health Choice Med Plan Inc (FL)/11122/'NR'/'Bq';

Communitycare HMO Inc (OK)/11691/'NR'/'BBBq';

Elderplan Inc (NY)/95662/'NR/'Bq';

GHS HMO Inc. (OK)/11814/'NR'/'Bq';

Globalhealth Inc (OK)/11709/'NR'/'Bq';

Grand Valley Health Plan Inc (MI)/95453/'NR'/'Bq';

Healthplus Partners Inc (MI)/11549/'NR'/'BBq';

Lovelace Sandia Health Systems Inc (NM)/95808/'NR'/'BBq';

M Caid (MI)/11557/'NR'/'Bq';

Managed Health Inc (NY)/95284/'NR'/'BBq';

Neighborhood Health Plan Inc (MA)/11109/'NR'/'BBq';

Physicians Health Plan Mid MI Familycare (MI)/11537/'NR'/'Bq';

Public Health Trust Dade County FL (FL)/95126/'NR'/'BBq';

Quality Health Plans (FL)/11519/'NR'/'CCCq';

Rochester Area HMO Inc (NY)/11602/'NR'/'BBBq';

Rocky Mountain HMO Inc (CO)/95482/'NR'/'BBBq';

Southeastern Indiana Health Organization, Inc. (IN)/95812/'NR'/'Bq';

Texas Healthspring I LLC (TX)/11593/'NR'/'Bq';

Universal Health Care Inc (FL)/11574/'NR'/'Bq';

Vista Health Plan Inc (FL)/95114/'NR'/'CCCq';

Vista Healthplan of South Florida Inc (FL)/95266/'NR'/'CCCq';

Welborn Clinic (IN)/95538/'NR'/'BBq';

Quantitative Insurer Financial Strength Ratings Withdrawn

Entity/NAIC Code/Prior Rating/Current Rating

Carelink Health Plans Inc (WV)/95408/'BBq'/'BBq';

Coventry Health Care of De Inc (DE)/96460/'BBBq'/'BBBq';

Coventry Health Care of GA Inc (GA)/95282/'BBq'/'BBq';

Coventry Health Care of KS Inc (KS)/95489/'BBBq'/'BBBq';

Coventry Health Care of LA Inc (LA)/95173/'BBq'/'BBq';

Coventry Health Care of NE Inc (NE)/95925/'Bq'/'BBq';

Coventry Health Care of PA Inc (PA)/95283/'Bq'/'NR';

Group Health Plan Inc (MO)/96377/'BBBq'/'BBBq';

Health America Pennsylvania Inc (PA)/95060/'BBq'/'BBBq';

Healthcare Inc (GA)/95769/'Bq'/'NR';

HealthCare USA of Missouri LLC (MO)/95318/'BBq'/'BBq';

Southern Health Services Inc (VA) /96555/'BBq'/'BBBq';

Touchpoint Health Plan Inc (WI)/95269/'BBq'/'Bq';

Wellpath Select Inc (NC)/95321/'BBBq'/'BBBq'.

Fitch's rating definitions are available on the agency's public web site, www.fitchratings.com. Published ratings, criteria and methodologies and relevant policies and procedures are also available from this site, at all times. This document will remain on the public site for seven days.

Source: Business Wire

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