Principal Health Care and Cigna HealthCare have agreed to swap HMOs in Columbus, Ohio, and Wichita, Kan. Principal will assume the Wichita plan, which covers 25,000 people, and Cigna will gain 27,000 enrollees in Columbus. The transaction, announced Oct. 10, is subject to state approvals. Financial terms weren't disclosed. The deal made geographic and organizational sense, the companies said. Cigna already covers 45,000 people in Columbus and operates HMOs in Cincinnati, Dayton and Cleveland, for a total of 115,000 enrollees in Ohio. Principal Health Care of Kansas City offers a PPO and an HMO to 102,000 enrollees in Kansas and Missouri.
Medical Care International, a subsidiary of Medical Care America, has signed a joint venture agreement with Samaritan Health System to provide outpatient surgery services to Samaritan hospitals. Financial terms weren't released. Under the venture, Samaritan and Medical Care will provide a network of six outpatient surgery facilities on Samaritan hospital campuses, including Desert Samaritan Medical Center, Mesa, Ariz.; Thunderbird Samaritan Medical Center, Glendale, Ariz.; and Good Samaritan Regional Medical Center, Phoenix. The deal is expected to be completed by Jan. 1, 1995. Phoenix-based Samaritan, Arizona's largest hospital provider, operates 27 owned or managed hospitals. Dallas-based Medical Care, which was recently acquired by Columbia/HCA Healthcare Corp., is the nation's largest outpatient surgery provider, operating more than 100 surgery centers in 25 states.
Community Psychiatric Centers reported a 59% drop in net income for the third quarter ended Aug. 31. The company reported net income of $1.7 million, or 4 cents per share, compared with net income of $4.1 million, or 9 cents per share, in the year-ago period. Revenues rose 32% to $105.7 million. Losses from its Transitional Hospitals Corp. subsidiary dropped but continued to affect earnings for Laguna Hills, Calif.-based CPC. For the nine-month period, CPC reported net income of $4.7 million, or 11 cents per share, compared with a net loss of $30.4 million, or 71 cents per share, in the year-ago period. Revenues grew 22% to $307 million. CPC owns 47 psychiatric hospitals and 12 long-term, critical-care hospitals.
Net earnings for Abbott Laboratories rose 11% to $351 million, or 43 cents per share, in the third quarter ended Sept. 30 from $316 million, or 38 cents per share, in the year-ago period. Worldwide sales rose 9% to $2.3 billion. For the first nine months of this year, net earnings rose 10% to $1.1 billion, or $1.34 per share, from $1 billion, or $1.21 per share, in the year-ago period. Sales rose 8% to $6.7 billion.
Michael Connelly has been appointed president and chief executive officer of Mercy Health System, Cincinnati, effective Jan. 23, 1995. Mr. Connelly is the regional executive of the western region of the Daughters of Charity National Health System. He will replace Sister Marjorie Bosse, who has been interim president and CEO since February. Mercy Health operates 18 hospitals and 11 long-term-care facilities in five states. It is co-sponsored by Sisters of Mercy congregations in Cincinnati and Dallas, Pa.
Charles Lindstrom, chief executive officer of Saint in Kansas City, Mo., since 1966, will retire Jan. 1, 1995. Mr. Lindstrom, 66, was one of the 30 healthcare executives who formed Irving, Texas-based VHA-now a powerful alliance of more than 900 hospitals-more than 20 years ago. He will be replaced by Richard Hastings, now executive director of 528-bed Saint Luke's Hospital in Kansas City and corporate director of the system's hospital division. The system also operates 147-bed Saint Luke's Northland Hospital with campuses in Kansas City and Smithville, Mo. The two hospitals are among eight developing Mid-America Health First, an integrated delivery system. Mr. Lindstrom still will advise the system and serve on its board of directors.