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| United Health Group Inc. |
The another, five-year contracts are likely to start on April 1, 2010.
"This is single of folks classic situations someplace the revelation is bad in place of the industry as a in one piece, since it doesn't add much another remuneration to either Aetna or United, but it takes away a large amount of remuneration from Health Net and Humana," wrote Carl McDonald, an justness analyst with Oppenheimer & Co., in a explore observe.
"The circulation is far more acute in place of Health Net," he wrote, for the reason that TRICARE accounts in place of more than a third of profits next of kin to its depressed remuneration apiece share center, but TRICARE is immediately a small part of Humana's remuneration jet.
Clothed in a statement, UnitedHealth (NYSE: UNH | Quote | Chart | News | PowerRating) thought it will be the outworker serving not far off from 3 million TRICARE beneficiaries in the south region, which includes Alabama, Arkansas, Florida, Georgia, the Fort Campbell area of Kentucky, Louisiana, Mississippi, Oklahoma, South Carolina, Tennessee and portions of Texas.
The contract's quantity is $21.8 billion and includes $1.5 billion in place of management support and services, UnitedHealth thought. The company besides may well earn other "incentive fees" based on its performance contrary to contract values.
UnitedHealth will provide therapeutic management, claims handing out, customer service, bringer networks, as well as support, such as cost-trend venture management and fraud detection.
Humana (NYSE: HUM | Quote | Chart | News | PowerRating) at present holds the south region contract, which it thought is collection to expire on protest 31, 2010.
"Humana Military is disappointed with the decision by the Department of Defense and looks send on to obtaining advance clarity via a debriefing on the bidding process," thought Dave Baker, president and chief executive representative of Humana Military, in a statement. ?Our company will evaluate its strategic options with respect to the government?S decision, together with protesting the honor, and will put-on expeditiously to superlative perception Humana in place of continued achievement.?
Humana thought it couldn't expect pardon? Effect the loss of the TRICARE contract may well maintain on its 2009 remuneration.
The Department of Defense awarded Aetna the TRICARE contract in place of the north region under which it will support escape of physical condition custody to not far off from 2.8 million TRICARE beneficiaries based in the 21 states of with the aim of region.
The Aetna contract is $16.7 billion, thought McDonald. Aetna couldn't just now be reached in place of comment.
The north region, at present held by Health Net (NYSE: HNT), includes Connecticut, Delaware, the District of Columbia, Illinois, Indiana, Kentucky, excluding in place of Fort Campbell; Maine, Maryland, Massachusetts, Michigan, New Hampshire, New Jersey, New York, North Carolina, Ohio, Pennsylvania, Rhode Island, Vermont, Virginia, West Virginia, Wisconsin and portions of Iowa and Missouri.
"Health Net Federal Services is disappointed not to be selected by TRICARE Management Activity in place of the Managed Care Support Contractor in the TRICARE North Region," thought Steven Tough, president of Health Net Federal Services, in a statement.
UnitedHealthcare companies at present maintain Best's Financial Strength Ratings ranging from A to A- (Excellent); Aetna companies at present maintain Best's Financial Strength Ratings ranging from A to A- (Excellent); Humana companies at present maintain Best's Financial Strength Ratings ranging from A- (Excellent) to B+ (Good); Health Net companies at present maintain Best's Financial Strength Ratings of B+ (Good).